Gwyneth Llewelyn discusses this problem in detail in her blog http://gwynethllewelyn.net/2009/09/25/step-up-for-content-creation-theft-awareness/

With the viewer and much of the server code going open source there is no feasible way to prevent copying, just ask the recording industry and game makers. They have been defeated every time they try copy protection. While it can take them years to build a copy protection system, it is usually defeated in days, if not hours.

Restricting the ability to transfer items seems to be the only enforceable protection that will work. ID'ing sellers and even those giving away free items is the only measure of protection that can be 100% server side enforced and extremely difficult to circumvent. Giving up the ability to transfer without ID verification is the least intrusive and most likely to work.