This is pretty off-topic, but I hate seeing incorrect factual
information about copyright.  I'm not a lawyer, but I have formally
studied the particular issue of copyright law.

> * Copyright covers *ONLY* distribution.

The legal term you are looking for is probably "reproduction," but the
statement is still incorrect.  Copyright law provides exclusive rights
of reproduction, preparation of derivative works, distribution of
copies to the public, public performance, and public display.  (These
rights are not necessarily absolute.)

It is true that copyright does not directly cover use.  In the case of
software, however, "use" involves the making of ephemeral copies at
many points.  There may be legal precedent that these copies are
restricted by copyright, but I can't currently find a reference to the
case I'm thinking of.

A report from the executive branch of the US government from a few
years ago, which can be used as a fairly decent (but rather publisher-
centric in slant) reference for US copyright law can be found at:

http://www-swiss.ai.mit.edu/6805/articles/int-prop/nii-report-sept95.txt

There is also a Usenet copyright FAQ by Terry Caroll which looked
pretty good, but I don't know when it has been last updated.  (The
copy I read was last updated in 1994.)

> I know of no place in the world where shrink-wrap licenses are valid

I am not especially qualified to comment on shrink-wrap licenses, but
my understanding disagrees with this statement.  The validity of
shrink-wrap licenses in the US under current law is still under
dispute in the courts, to the best of my knowledge.  But the issue may
become moot soon; there is currently legislative momentum behind
validating shrink-wrap licenses explicitly in the law, distasteful as
that may be.