Sunshinefiasco asked about the legality of using graphics in their diary. If you are going to use a graphic that is already on our system and comes up in the drop down boxes for areas such as background image etc, then those graphics have been specifically made public for others to use so go ahead and feel free.
Using any graphic that is not in a dropdown box in the customiser is definitely a case of dropping whomever is using it a quick email just to double check - many people don't bother doing it but it really is a decent courtesy to extend to someone and we would strongly recommend that you follow this. The same extends to borrowing graphics from another website, there could well be copyright on those graphics and you don't want to get into trouble :)
Next, calgar asked about limiting the readership of a diary by the Atomic Systems username, for example. I'm happy to say that the ability to limit readership has been planned into Dear Diary 3.0 now for quite some time and will probably follow the same kind of mechanism as the new comments system. For example, you can set your diary to only allow Atomic Systems logged in users, only allow specific Atomic Systems logged in users, or allow anybody that gives a password that you hand out to friends/family etc that you want to read your diary but don't want to force to get an Atomic Systems account.
I hope that answers the questions... The next obvious one, when is Dear Diary 3.0 coming? I don't know yet, is the honest answer, there's a huge amount of work rewriting the existing system to be done before we can get on with all these new features but I can say that what's currently done is looking awesome :) (IMHO strictly, ofcourse ;) ).
Matt.