When I buy S2 (which I am doing once a get a computer good enough to warrant it) if I put a skin I have made up for people to download so they can see it as I race online can they also then take that skin and use it themselves?

Correct, technically speaking.

They cannot take it directly, unless they convert it from the .dds form into a .jpeg. Otherwise, your skin is safe.

Ok thanks, I know it sounds a little selfish trying to keep it to myself. However I just like the idea of being the only one with a certain skin.

Quote from Ca18Slider :

They cannot take it directly, unless they convert it from the .dds form into a .jpeg. Otherwise, your skin is safe.

I don't see how - skins in LFS are now DDS files, they just plop that in the skins_dds folder...