duchess of malfi wrote:It's for sale on ebay. Is it even legal to sell something like this, meant for limited distribution, on ebay like that?

It's definitely not, duchess. It's a form of piracy, because neither the publisher nor the author makes any money off the sale of the book. Even ARC's aren't legally saleable; most are marked with "Advance copy - Not for resale" on the jackets. Of course, that doesn't stop people from buying or selling them.
I think it's one thing to buy an ARC of a book that's been out for a million years and both has done and will continue to do its author proud,* and another to sell the unedited manuscript review copies before the book comes out. For one thing, you aren't getting an authorized version of the manuscript--and I mean author-ized. It probably isn't as polished as the author would like, it'll have typos, etc. For another, you're totally ripping off the author and the publisher before the book has a chance to earn for itself.
I don't blame anyone for buying it, cause who could help themselves? But I do blame the sellers. I really really hope that the person who's selling the unedited review mss online doesn't actually work for the publisher, because they'll get fired for ethical misconduct faster than you can say "intellectual property rights."
*yes, I've done this--I very naughtily bought an ARC of MOHD last month, but can you blame me?But I've also bought the book three times in paperback (twice new, once used). So there. 
Halfway down the stairs Is the stair where I sit. There isn't any other stair quite like it. I'm not at the bottom, I'm not at the top; So this is the stair where I always stop.