Okay, clearing things up.
He's making a fan game. It's non profit, so it's legal. He's using SMBX, a program that allows SMB level editing; a drag and drop software. He's probably some young kid who found this software on a youtube video, because 12 year olds tend to linger on the "Mario" section of youtube.
Honestly, I hope your game is awesome. Some people can do great things with software like this, so keep going man. Don't listen to Linkus, he's being an ass.