As discussed in prior forum discussions, the "1.2Ghz" spectrum is NOT totally illegal in the USA. For example, licensed ham's can officially use 1.24Ghz to 1.30Ghz under the FCC Part 97 rules.
The problem that has come up is that many of the popular imported video Tx's found on eBay and other sites are not really as advertised. Instead of being "1.2Ghz" they are actually using the 1.00Ghz to 1.19Ghz area, which is reserved for commercial aviation navigation in the USA (NAVAIDS). These Hong Kong products use this {USA} illegal RF spectrum because it is legal in THEIR country.
This issue can also extend into "900Mhz" products, so you need to know what you are buying. Allowed ham freq's (license req) are 902.0 to 928.0 MHz and several hundred watts are possible. The FCC Part 15
registered devices on 900Mhz (or any other video Tx frequency) are license free and can be used by anyone. These products (video senders, cordless phones, wireless data, etc.) transmit using average power levels that are less than 1mW (.001W), which is too low for practical use in our R/C video application.
For more info on the spectrum allocations, please see this chart:
http://users.skynet.be/on1dht/ibandguide.htm
The "legal" questions really depend on what you are asking. If you mean "Is it legal to use any of these unregistered (not Type-Accepted) video Tx's without a license," then the answer is No. However, if you are asking "Can I use these video Tx's with my valid ham license," then the answer is Yes, but only if the device complies with the Part 97 rules.
The best course of action is to earn a ham license. It opens up a world of RF video products to you. The license is nearly free (test admin cost is usually a one time $15 or so) and is good for 10 years. Renewals are free. The test questions are not hard. You do NOT need to know Morse code. The technical stuff you learn to pass the test will help you obtain better performance from your wireless video equip. And best of all, following the ham rules prevents disruption of the other hams that are operating legally on the shared airways (they are hobbyists too, just like us R/C'ers).