[Fyron]

Technically, no, because you don't need the CD to play the game. All that having the CD in the drive does for you is allow you to listen to the annoying music. And since you don't need 2 copies to play with someone in a hot seat game, making 2 installs to let 2 people play over a LAN is, IMO (not necessarily that of Shrapnel/Malfador), a reasonable use of your copy of the game.

Legally, yes, your housemate should buy his own copy (or you buy one for him).

Hopefully, Richard won't be mad at this post. If he doesn't approve of it, I will delete it ASAP (or he could delete it if he feels so inclined).