This is no different than people selling themes and mods for the phpnuke site. They are not selling phpnuke itself so it is not an intellectual property issue.
If you want to talk intellectual property then talk about all the games that the hundreds of sites are running using the v3arcade addon. I am quite sure that nobody asked permission of the authors of the games to use them. Some of the games are used with permission but many are not. An example would be all the Yeti Sports games, the Sonic games, etc.
If you shutdown sites that provide the games, then you are shutting down the arcades that run them too.
Converting a game does not give you ownership of the game, it just makes you an accessory to stealing them (unless they happen to have gotten permission).
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