Not illegal. If you purchase the software legally, you can install it however you want. The bit on doing a repackage is that the vendor (any vendor) will then invalidate support.
Plus, bad practice to repackage a MSI into a MSI. You can't ever get all the pieces.
I do it in an MST. Then, you don't edit the MSI, you just change it for yourself. If something doesn't work, you can then send your MST to the vendor technical support easily. But in an MST, you can't get to the Setup.Exe-Requirement. You can only do that in the original ISM file, which I can't get.
I got our Blackberry internal guys to open a ticket to RIM for me. RIM Support guy acknowledged that past installs were unlocked and this one isn't, and he is going to try to get to the unlocked one and send it to me. I will post my results here of whatever they come back with.
Of course, after that, then it's back to trying to get rid of the initial config box so that (L)users don't see it and turn on Updates. In the packaging world, if it's not one thing, it's another