You really have no idea what you're talking about here. An industry that has had almost a century to prepare has a considerable legal advantage over rookie musicians, who can usually barely afford their instruments, let alone proper representation.

> I don't care about the major labels, what I care about is maintaining a social structure where creativity can be rewarded and the investment and time put into great quality intellectual products isn't wasted.

Such a structure will eventually unfold, we're looking at a lively market here.

Just like open source didn't kill software development wholesale copying won't kill the music market. But it will kill the current business model.