OK then the above implies:

     1. Not all packages in pkgsrc are $0.00 cost.  True?

Well, the files in pkgsrc are free (BSD license of course).  Packages,
which are _built from_ pkgsrc are not necessarily free software;
that's only true if all the distfiles are free.

     2. Not all source distributions are $0.00 cost.  True?

true!  (While "Proprietary software is a predatory social system",
there's a lot of it about :-)

  I'm assuming the vmware packages behave like GPL open source packages
  in that the package downloads, the distribution source code downloads
  and can then be compiled, installed and run.  Is my assumption faulty?

Totally faulty!  See the fine vmware website.  See the LICENSE= line
in the pkgsrc makefile.  See the referenced license file in
/usr/pkgsrc/licenses/vmware-license.  Basically, VMware is regular
proprietary binary-only pay-per-seat software.

Seriously, there is no rule that pkgsrc only packages free software.
But you won't be able to build anything non-free, in theory, unless
you set "ACCEPTABLE_LICENSE+=foocorp-icky-license" in /etc/mk.conf or
someplace.

  I'm not advocating any criminal activity whatsoever but as a practical
  matter how does VMware enforce their license if the package behaves as
  I assumed above?

The vmware program looks for a license file; you get one when you buy
a license and presumably it is keyed to your purchase info.  There is
no license server silliness, and licenses (and license files) don't
expire.  So in all seriousness given that it is proprietary
binary-only software it really it is pretty civilized.

Also vmware is a Linux binary, so you need linux emulation, which
isn't bad, but also it only works on i386.  For this package that's
true anyway, since AFAIK vmware only runs on i386.

  >   vmware works pretty well, but I (with vmware2) have occasional
  >   lockups and crashes.

  In pkgsrc speak "vmware" is "VMware Workstation 2.x" and "vmware3" is
  "VMware Workstation 3.x" i.e. there is no "vmware2" in pkgsrc speak.

  Can you clarify which version "works pretty well" and the version that
  has "occasional lockups and crashes" using pkgsrc speak?

Both Workstation 2.x, from pkg emulators/vmware.  I have not tried
vmware3 yet.  Basically the crashes are annoying, but I'm still able
to get work done and it isn't bad enough that I'm worrying about it.
Windows in vmware crashes every few weeks, vmware dies a bit less
often, and the whole machine locks up every few months.  But I run
coda and a lot of other stuff, and I've modified my kernel for new
(research0 IPsec features, so it's hard to pin the blame.  But I
believe vmware/linux-emulation to be at least partially at fault.

When the whole crash happens, I reboot netbsd, it fscks, I restart
vmware, it complains about stale lock files and purges them, and then
I reboot windows and it checkdisks.  Then I can log in to windows and
edit monopoly formats again.  Aside from the netbds fsck of a 60G
disk, this takes less than 10 minutes.

 > pkg_info vmware
Information for vmware-2.0.4:

Comment:
VMware emulator 

Requires:
suse_base>=7.3
suse_vmware>=6.4nb1
suse_x11>=7.3
vmware-module>=1.0

Description:
Run Windows 95, Windows 98, Windows NT, Windows 2000, FreeBSD, NetBSD,
or Linux under VMware Workstation.

Each VMware world is the equivalent of a full PC in a window.

Operating systems run simultaneously without dual booting.

Add new operating systems without repartitioning disks.

Homepage:
http://www.vmware.com/



You also need:

suse_vmware-7.3     Linux compatibility package to support running VMware
vmware-module-1.2   Kernel modules for the VMware 2.x emulator
vmware-2.0.4        VMware emulator


vmware-module is two kernel modules that vmware needs.  That was the
hard part of making vmware run on NetBSD (from Linux).  Someone, I
think fvdl, at Wasabi did this, IIRC.