>The service is intended to turn ripped songs from already purchased CDs.

Apple didn't pay $150,000,000 a pop to the major labels to allow you to play music you legally acquired.

>It doesn't magically turn illegally downloaded music to legal ownership

  Step 1) Purchase an iTunes Match subscription
  Step 2) Convert MP3s to iTunes matched AACs
  Step 3) Delete MP3s

stare in amazement at this magic before you