I’m no copyright lawyer but I don’t really think that the guys that re-skinned Temco’s beach volleyball game into Nude Beach Volleyball are in the wrong. To me it seems analogous to creating an offensive Windows XP theme pack and distributing it. The only difference here is that the game wasn’t meant to be skinned.
However, the issue probably stems from the clause in the End User License Agreement that might say something like: Thou shalt not modify this game.
Obviously there are some rights you have with items which you have legally purchased like if I wanted to buy a toaster and toss it off the bridge into the harbour. I think that the grey area exists when you buy something, modify it and then try to distribute that thing.