Does anyone know if they're allowed to do this?

I'd guess not, based on the copyright statement: "This CD-ROM is intended for use by one individual. As such, you may make copies for your own personal use. However, you may not provide copies to others, or make this reference library available to others over a LAN or other network."

Edited by davido: disabled link to a website that violated US Copyright laws by electronically distributing O'Reilly books without authorization.