Ok, so I've read all of this finally.
I think this whole thing with LemonMelon has been misinterpreted a bit. Perhaps calling it a Fake List didn't help, because in reality, it wouldn't be fake. It would be a real piece of music, a real form of art. So first and foremost, I would stop calling it fake, because it's not.
Now if you all understand that this music LM is doing is actually real, and will be something officially posted by LM to the public in some fashion, such as MySpace, that is within the rules, and has been clearly communicated many times in the past.
I think the gray area here is the use of different names. Again, I would stop referring to them as "fake names" - if an artist decides to call himself something else, and release it under that name in some fashion, IT IS REAL. It's called having an alias, and is done in the music world all the time. Moby has released an album under a name called Voodoo Child - it's a different name, but make no mistake, it's all Moby. However, if I wanted to use a track by Moby and one by Voodoo Child, I can. It is allowed. And as someone else already mentioned, Tom Morello goes by an alias called The Nightwatchman. If Morello ever releases something in his own name, it would still be a separate entry from The Nightwatchman, even if both are the same person. And if someone wished to use both in Desert Island, they could, because it's within the rules of the competition.
So to cut to the chase, if LM wishes to include his own music, and has created different aliases for different tracks, he is within the rules of the competition. It is allowed. Plain and simple - there's really no argument over this.
I'd also like to make another comment. With Desert Island, although we do have certain rules (one artist at a time, official releases only), I want to remind everyone that you can use whatever music you want, and you can create it any way you want. It doesn't have to be a concept piece, it doesn't have to have all indie tunes only, it can be chock full of #1 hit singles, it can be anything. It is within the rules. And if you want to create a concept or theme for it, you can do that, too. The whole object of the game is to create something that works best for YOU - not for me, not for Axver (even though you'll get a punishing review most of the time, but don't mind that - he's always like that), and not for anyone else. But keep in mind, people will vote for you based on their interpretations as well. You many not agree with it, you might think it is complete bullshit, but how someone else sees your art will not always align with your thinking. Keep that in mind.
We're supposed to have fun with this people. It's a way to share music and explore how different types of artists and genres look in a different light when mixed together, and to see how others come up with something totally different to you. You may not like what others do, and sure, be prepared for some good natured ribbing if it is an artist a lot of people don't care for, but don't take it so seriously. It's a game, it's music, and it's supposed to be just good, fun entertainment.