Award doesn't distribute its BIOSes freely. It licenses specific versions to OEMs, and these OEMs may distribute the BIOSes that they've licensed as they see fit.
As the End-User, you are granted a license to use a specific BIOS version as "flashed in" by Netpliance. Since Netpliance hasn't made any BIOS upgrades available to End-Users, it can be argued that any deviation from that specific BIOS version would violate the license as granted by Netpliance. (You're violating Netpliance's license to you, not Award's license to Netpliance)
By using a "Patched" version of the same BIOS, you could argue that someone just went in and fixed the bugs in the code that was already licensed to you.
By using a Version that didn't come with your machine (V1 or V5 on a V2,V3, or V4, for example), you are using an unauthorized and unlicensed copy of the BIOS.
It's doubtful that you'd get caught and sent to court for using an unauthorized version, sure. It's more a matter of Ethics, and I'd hope that there are at least a handful of Hackers who can hold themselves up to a higher standard.
The reason the CDROM-Bootable version will never be released is because (unfortunately) there are too many people who are happy to see Netpliance die -- only to get a cheap and valuable machine out of the whole ordeal. Having a CD-Boot feature would only increase the value of these machines -- thus increasing the satisfaction of watching Netpliance die and scoring all these extra-value machines.
Besides, how can people call themselves "Hackers" if they can't figure out how to work around a problem? If you're gonna screw over a company like Netpliance, at least put some effort into it.