People shouldn't be using other people's artwork or fakemon without permission.
Asking someone to sprite something for you like a fakemon found on google or deviantART is actually fine and okay. As long as you aren't claiming that the fakemon belongs to you, I personally consider it more as fanart. But when you start using the fakemon sprites for games and ROM hacks, that's when you start needing some authorization from the creator of the original art.
Don't claim that the artwork and idea is yours, and restrict the amount of people on who can use the sprite(s) of the Fakemon.
And concerning RyeGuy:
I hope you've gained permission from the creator of that to use it in your projects and ROM hack. Remember that art theft, including sprite theft, will not be tolerated.