In 20 seconds of googling I didn't find pg urging entrepreneurs to be naughty. I did find YC's ethics policy[1], and the only mention the of the law that I see is related to sales tactics, "Not using misleading, illegal or dishonest sales tactics." This needs revision.
There are lots of laws that are challenging and problematic, even impractical to follow exactly, e.g., the tax code. It's one thing to interpret the tax code in your favor; it's another thing to write a program to distort your business information to avoid taxes.
[1] https://www.ycombinator.com/ethics/
EDIT: Found the naughtiness link. Reading now.... EDIT 2: I'm completely opposed to drug laws. Drugs laws are sickening and immoral, and our society and countless individuals have paid a terrible price as a result of these laws, but that doesn't make it ok for me to sell drugs on the street.