Check out the Sticky post titled:
SHOUTcast: Important Info & Answers to FAQs. READ ME!
Scroll down a bit and look for the section titled:
How to Setup a Live Audio Stream -> How to set up an Internet Radio station
How to Setup a Live Audio Stream -> 15 Steps to setting up SHOUTcast
Additionally, check out these tutorials:
Please read some polite advice.
The rules/laws vary depending on the source location.
For folks in the U.S.A. (and others wanting a good read), try this for starters
For a more definitive answer, please consult legal assistance.
Please see this thread
for royalty options via SWCast.