What are the disadvantages of jailbreaking iPhone 4 even if it's legal?
Disadvantages:


Potential reduced stability of the iDevice

More-than-usual application crashes
Unusual application behavior
Buggy connections (like WiFi), especially on beta releases of jailbreaks. (In other words: wait until the people who write the jailbreak say it is ready for regular use. Otherwise, expect occasional pain.)

Potential failure of application features

Most notably of late was the issue that iBooks would lock users out of DRM'd material if they were jailbroken. It could determine this by attempting to run unsigned code, which if it ran, would let iBooks know the device was jailbroken. A hack was released later to resolve the issue, but there is always the chance another application will also implement such features.

Inability to receive Apple support

Apple doesn't want to support any jailbroken device (nor should they be required to do so). If you run into something critical, restore/upgrade to an unjailbroken state first, at which point Apple should be able to help. (Although chances are very good the particular problem will also have gone away.)

Increased Memory Load

On the iPhone 4 it isn't as obvious, but it is (IMO) very obvious on the iPad 1 -- when you add services that must always be running (e.g., SBSettings, etc.) you increase the memory load on the device. Apps that were previously very close to running out of memory may do so when they least expect it, leading to unexpected crashes. This isn't particularly the fault of the jailbreak itself -- but typically one doesn't jailbreak and then not install other jailbreak-specific apps.

Increased Likelihood of Strange Behaviour after iOS upgrades

Example: I had a 5-row keyboard installed on my iPhone 4. After I upgraded to 4.3.2, I ran into an immediate problem: whenever I needed my keyboard, most of it didn't appear, and most of it didn't work. Apparently parts of the 5-row keyboard configuration had stayed around after the upgrade, and the only fix was to go into General -> Keyboards and switch to the English keyboard. (At the time there was no untethered jailbreak for 4.3.2, or I would have continued the jailbreak, which likely would also have restored keyboard functionality.)

Increased Security Concerns

Jailbreaking can oft mean adding software that hasn't been through Apple's vetting process, which may make it easier to get malware or other software that does "bad things". 
If you add SSH functionality, be sure to change the root and mobile passwords; otherwise you'll get hacked in no time flat.
On the other hand, you can also sometimes get increased security. IIRC, there was a Cydia app that was used to add security to the device (essentially something Apple should have done, but hadn't to that point).



Personally, the pros of jailbreaking far outweigh the possible cons. I've had far more strange behavior than typical for an iDevice, yes, but I also expect it and know how to deal with it. Some features are such that I really expect that Apple should have implemented them to begin with, and sometimes Apple does occasionally remove one or two particular jailbreaking reasons. But until they satisfy my (very) long list of jailbreaking features, I'll keep on doing it.