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Question: First of all is it legal to Make a backup copy of a purchased music cd or a dvd? Second of all could i have an electronics store and offer a free CD to MP3 to MP3 player
service or free Purchased CD backup service?

Answer: When a music CD or movie DVD is purchased, you are not purchasing the full ownership of the copyright. You only have a license to play the songs or movie. The question boils down to “Fair Use.” In the U.S., it is fair use to make a back up copy of software for example. Although argued, one can apparently copy his/her music CD. The copy cannot be sold however for no right of reproduction has been granted the CD purchaser. Also, MP3 or music CD format will not matter. Copying DVD movies is even trickier. The Millennium Copyright Act made it illegal to reproduce copyrighted material from DVDs, so no luck there. This may change in the future, but no one can be sure. If you make copies for someone, whether you sold them the original or not, you would be reproducing. Sounds like trouble to me.