From what I have gathered it is still legal to chip a PS2 but only to play imported games, thats why if you notice all the top makes of PS2 chips now offer a downloadable firmware so you can play copied games.
@Dingotest I will send you a pm of a company I found on the net, if you live near manchester, bowlers has a computer fair on every weekend and you can take your PS2 down and there are a couple of guys there that will chip it while you wait and you can see it working infront of you.