LCDproc is released as "WorksForMe-Ware". In other words, it is free, kinda neat, and we don't guarantee that it will do anything in particular on any machine except the ones it was developed on.
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It is technically released under the GNU GPL license (you should have received the file, "COPYING", with LCDproc) (also, look on http://www.fsf.org/ for more information), so you can distribute and use it for free -- but you must make the source code freely available to anyone who wants it.
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For any sort of real legal information, read the GNU GPL (GNU General Public License). It's worth reading.