1)Why were previously illegal, or did i misinterpret the information?
Pure politics and asinine stupidity on the part of the FAA, FCC and the then commander of the U.S. Air Force Rescue Coordination Center(AFRCC), along with concerns about misuse from some of the SAR community at the state and local levels and some concerns about cost of implementation at the state level. Most of this was turned around by some courageous action on the part of the new (current) commander of the AFRCC, LTC Scott Morgan, who decided that saving lives was, indeed, the business they were in. Once he was on board and pushing, all the other objections were able to be dealt with one way or another. The FAA was being absurdly overly protective of "their" 121.5 MHz emergency frequency, primarily, which was in fact already in use on marine emergency beacons, and their objections were dealt with by inserting a Morse code P into the analog signal of the mandated low power (only 25 milliwatt) 121.5 homing signal so their would be no confusion about whether the 121..5 signal was from an aircraft ELT or a PLB (unless it is from a marine EPRIB, but don't let that get in the way of their illogic).
For the rest, I see you have found your answers here or elsewhere. I will be adding quite a bit more on the subject of PLBs over the next month or so.