AFAIK the whole doujin scene is all about "go on, violate our copyrights but don't complain when people violate yours".
ZUN's blanket ban on commercial distribution makes it really difficult and expensive to legally obtain anything when the only distribution channels are specialized doujin stores -- it's still commercial, but the ones getting the profits are various middlemen and not the arrangers and performers.
ZUN has granted blanket permission for fanworks distributed in the spirit of the original games, but explicitly forbids distributing arrangements of his music through mainstream sales channels (music stores, iTunes, HDTracks, and so on).
Maybe ZUN himself is cool with people distributing his work on the internet, but I don’t think that all the doujin circles are cool with people distributing theirs.
Is, uh, there a version of this, perhaps called the Touhou Lossy Music Collection, for apparent plebes like me who don't care about codecs discarding data that I can't hear anyway?