Wow, this is getting nasty. I've been reading this thread lately not out of personal involvement but out of professional interest - I'm a paralegal with 10+ years of experience in publishing and intellectual property law. I've never dealt with Kat or sspert so I'm not trying to stick my nose in here and take sides, but since I have some experience with this kind of stuff, there's something I wanted to point out.
JLPRocks was absolutely right when he said that Kat has stated, in a public forum, that she's sold unauthorized CDR's of copyrighted material. That statement, along with any records that could be subpoenaed from eBay (if she did sell these on eBay) and/or any other electronic media (including email accounts), could be used as evidence in a civil action and could result in a monetary judgment in favor of the band's label and/or publishing company, if they were to bring a copyright infringment action against her. Just because a band's material was never officially released or currently commercially unavailable in no way means that their copyright is no longer intact - that's a no-brainer and should be common knowledge. Most copyrights are registered internationally as well as in the US, so a label or publisher could possibly file a lawsuit in a Canadian court.
Like I said, I'm not taking sides here because I'm not personally involved and I don't have all the facts, but I wanted to point out the possible implications to EVERYONE, not just Kat. Given the current climate in the music business against piracy, we should all be careful about what we buy and sell and the statements we make about it. Even my offer to Rick could be construed as piracy - remember the old Napster?? You'd be surprised how many people anonymously read boards like this - for instance, there have been huge effects on stocks just because of what's posted on a message board (Yahoo Financials, for instance).
It's just something to keep in mind when buying and selling. Sorry this was so long and I hope no one thinks that the newbie is trying to jump in here, but I just wanted to share what I know. Thanks.