I'm totally confused about the legality of fonts.

If a font came installed on my computer, do I therefore have a license to it and am I free to use it however I choose, such as in an RM game? Also, legally, is there a difference between simply using a font (setting it as "default" in the script) and actually having it in a "Fonts" folder packaged with the game? I think this counts as redistribution, but what about the other example, where it's simply used if it's already installed on the player's system, but not "physically" included in the game's files? Or does the initial "license" cover physical inclusion/redistribution?

Bleh... :barf:

"If a font came installed on my computer, do I therefore have a license to it and am I free to use it however I choose, such as in an RM game?"

Yes, but you can't give that same right to someone else.

"Also, legally, is there a difference between simply using a font (setting it as "default" in the script) and actually having it in a "Fonts" folder packaged with the game?"

Not really, since you have to have the font in the folder like that to even use it in the first place.

"I think this counts as redistribution . . . "

Not fully.  You are letting people use it in the context it's allowed.  It's only different if you try to tell people that this means they have rights to use the font themselves or just gave out the font with no game attached.  It works pretty much the same way that the graphics packs do.

". . . does the initial "license" cover physical inclusion/redistribution?"

Yes, but only in the context of "I'm using this".

interesting...

If you would like to use those fonts that you can buy, you should encrypt them since it would mean that people can use them as long as they open your game folder and install it to their systems, and that's against their terms.

I'd like to point out that all of my answers were in the context of "the fonts that came with my OS".  If you're downloading a font from the internet things are going to be different and you'll want to look closely at the license it's distributed under.  CC0 is fine, GPL and CC-By-SA are incompatible with RPG Maker, I'm not sure about CC-By because of the whole no-DRM stuff hidden in the licensing rules.  If you buy the font for use you'll want to read through your UELA to find the answers.

BTW, I'm also not a lawyer, what I say isn't law.

What I meant was the game using a font if it's installed on the user's system, and if not, using another font (that would be included in the Fonts folder). For example,

Font.default_name = ["Palatino Linotype", "TeXGyrePagella"]...So if they don't have Palatino Linotype, it will default to the included TeXGyrePagella, a free alternative I downloaded (though not nearly as pretty as Palatino Linotype). I'm fairly certain Palatino Linotype was included in my operating system to begin with... and going by what you said, would therefore be okay to pack in the Fonts folder of the RM project, correct? So I wouldn't even have to bother with the backup TeXGyrePagella.

For me that's a given, but would I have to explicitly state that the font is not to be redistributed somewhere, in the game's readme.txt for example?

EDIT: One more question. Is Palatino Linotype basically ubiquitous across Windows systems (like Arial, Tahoma, and Times New Roman)? If that were the case, then it would already be installed on the computers of anyone who'd play my game, and I wouldn't even need to include it in a Fonts folder with the game.

Freshly installed Windows 7 64bit (2 days ago) and i have it (havn't installed any font jet and no programm that i would consider installing fonts).

Also checked my win xp VM: It's also there.

Can't say for other versions, but think you can consider it as Windows default ^^.

Graphic Designer here. I know my fonts. (Still not a lawyer though) 

Many fonts, particularity commercial fonts you buy, don't necessarily grant you a license for embedding the font into files or software. Encrypted or otherwise. 

You may need a special license for that. Embed the wrong font in your game without checking your license and you could land yourself in serious trouble.

You need to have an "Application License"  Which is not the same thing as a commercial license. 

However, that's if you're using the actual font files/data. If you convert the font into a sprite based font (No longer editable and re-sizable) then it should be fine for most fonts. It's kind of a weird technicality, but there's reasons for it. 

If you're using a font that the user already has on their computer, then you can use it in your game. The font technically isn't part of your game at all, in that case. This can be a major problem if the user doesn't have the font, but if you keep to standard fonts that come with windows, like Times New Roman, for example, that problem shouldn't crop up. 

The thing is, with RPG Maker in particular, using the font file in your game's fonts folder basically counts as re-distributing it. So you need a license that lets you redistribute the font, no paid font will allow that, and many free fonts still don't allow you to do that. (So the user would have to go download the font directly from the font creator's page separately) And if your game is commercial, you would need a license that would actually allow you to RESELL the font as part of a package, which no commercially protected font would allow. 

Long story short, the solution is to use open source fonts. They usually have an "OFL" Open Font License, and you can basically do whatever you want with those fonts, including packaging a copy of it in commercial games and reselling it, so long as you keep the actual license document in the fonts folder with the font. Also, some fonts are public domain. Basically, check the license that came with the font. If it doesn't have a license, be safe and don't use it. 

To clarify, you can "use" default system fonts because they are not a part of your game software. If you have a font that you cannot distribute the data for, using it in pre-rendered images such as in HUDs and interfaces, cutsceene graphics, as text elements in your game art, or even as a sprite based font are usually allowed. It's just the actual font file you need to be careful with. 

This topic comes up quite a bit. Could be a good thing for somebody to come up with a list of fonts that are available to use without having to jump through hoops or buy multiple licenses.