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I feel like $500k wouldn't come close to paying for the two years of research that went into this report.

So for 72 puts they opened at 13.54 and hence it's 1100 $ gain per contract

The 60 puts are 3.25$ hence gain is 300$ per contract

Assuming hindenburg bought a 1000 of each 1100000 on the 72 puts and 300000 on the 60 puts as Sq block is now trading at 58$ much to jacks chagrin

That's a cool 1.4 mn $

Is this legal if so why isn't everyone doing it?!

Because it is extremely risky, even if you are right, and extremely capital intensive. That being said, there are loads of short sellers out there doing exactly that, all the time, with all kinds of companies.

When short sellers buy puts they usually buy 1-day expiring ones. The profit here can be 5x-10x the amounts stated here.