Jailbreaking is definitely and absolutely legal. U.S. courts have ruled so, and such a ruling tends to set an international precedent, since laws in this area are pretty much unified across the globe. Bottomline, it's your device, you bought it, and nobody can tell you what you can or can't do with it. I wouldn't worry about the warranty either. I've had certified Apple techs tell me that a jailbreak cannot mess up an iOS device to the point where you have to bring it in (i.e. you can always use the restore function), and if it could, then it would be messed up so badly that not even Apple techs would find out that it was due to a jailbreak.
I love my iPad and use it for all kinds of things, but it's definitely a gadget and not comparable to a netbook or other full-featured computer. It's not a shrinked netbook, but a super-sized smartphone. You're restricted to a fixed, proprietary, closed operating system with a controlled market. They have their uses, but they're not the same as those of full-fledged tablet PCs that can run real PC operating systems.
As for music, the iPad can do everything an iPod can. It's just quite a bit bigger so you probably won't carry it around in your trouser pocket