The experience of Second Life has made it clear that user content is not merely an incidental addition to the world; it is the very core of what makes Second Life what it is. The vast majority of what you see in the world was created by residents, not by Linden Lab. Nobody who has been in the world for more than a week would be caught dead wearing Linden clothing; it's the mark of a total newbie.
It is also clear that ownership of that intellectual property is important. Many content creators derive a significant amount of real-world income from their sales in Second Life. Impassioned debates have broken out on the Second Life forums about it, especially about actions that content creators consider theft.
The permissions system in Second Life is a form of DRM (digital rights management) it limits what you can do with things that you buy. There are problems, however. First, there are technological workarounds that allow some creations to be duplicated, even when the SL permissions prohibit it. For starters, there is the virtual world equivalent of the "analog hole" for music; you can always make a degraded copy of an image by taking a screenshot of it while it is displayed on your screen. (There has been talk of future operating systems that would operate as "trusted systems" which would enforce content restrictions at the OS level; no such system is in use by consumers at this time.) Another problem is that there is no way to allow some things that we would consider "fair use" of a creation that you had bought in RL (real life) without also permitting things that would not be considered fair use. For example, the only way to add a tattoo to a skin, rather than have one that you wear over the skin (yes, sometimes the distinction matters) is to do it outside Second Life, with access to the master files for the skin. But once you have those files, you could also modify the skin more thoroughly, or resell it to anybody you liked; things that the creator might not want you to do. Or if you buy a house, you might like to be able to paint the walls; but to give you that ability, the creator also has to give you the ability to change the structure of the house.
Some content creators just ignore the limited permissions system, and instead include license agreements with their goods. Most texture sellers, for example, sell their textures (images that are intended to be applied to things that a user creates, such as wallpaper for walls, siding for building exteriors, patterns for rugs...) with full permissions, because in the current permissions system of SL, you can't make full use of a texture otherwise. But they also include a license that prohibits resale of the texture as a texture; the buyer is allowed to sell objects that have the texture applied to them, but not the texture itself. There is no way to enforce such a license within Second Life; a lawsuit in RL might be possible, as the unauthorized resale of a texture is a copyright violation. (Theft of user-created virtual world property is a completely untested area of law, so far as I know.) Linden Lab does not offer any enforcement of intellectual property rights within the confines of SL; they advise the victims of violation to file a DMCA (Digital Millenium Copyright Act) claim, at which point they will act to remove the offending content from SL.