They system isn’t out yet but during the Live Letter they stated that if too many people make non-Final Fantasy XIV copyrighted song covers (and post them online ofcourse) that they’ll remove the system.

“However, please make sure to perform music that is FFXIV-related. We don’t mind if you’re using it for personal use; however, if songs and music from other titles are being recorded and uploaded frequently, we may have to remove the feature, so we would like to ask for everyone’s support… “ - http://forum.square-enix.com/ffxiv/threads/344248-Letter-from-the-Producer-LIVE-Part-XXXVIII-Update-Thread?p=4389757&viewfull=1#post4389757