Homebrew games are public domain and completely legal, as they are homemade freeware games made by freelance programmers.
Nobody said homebrew games aren't legal. The truth is, they are indeed completely legal, just as you say; however, the methods of playing said homebrew games CAN be illegal.
If you have connected to the Internet using your Wii, you digitally signed an agreement stating you would not modify your Wii in any way, shape, or form. So yes, it's illegal. They continue to patch it because it's illegal. That's what I've been told, at least. I'm no legal expert when it comes to these things. I'm not gonna say the Twilight Hack isn't fun. I have friends that have done it.
It's like the R4. Playing homebrew on the DS isn't illegal; however, the R4 is used mainly for pirating video games and as such has been declared by Nintendo to be an illegal, unauthorized product. Using it to play homebrew is still against the law, because the device you have to use in order to play it is illegal. The end most certainly does not justify the means.
Regardless of whether or not it's illegal, though, I'm going to lock the topic because it's discussion of modifications to video game consoles, which is against the board rules (rule #9, to be exact -- "anything else that is not made directly by the manufacturor or used in conjunction with the intended original system.")