From Network Solutions web page:
[ul][li].com represents the word "commercial," and is the most widely used extension in the world. Most businesses prefer a .com domain name because it is a highly recognized symbol for having a business presence on the Internet.[/li]
[li].net represents the word "network," and is most commonly used by Internet service providers, Web-hosting companies or other businesses that are directly involved in the infrastructure of the Internet. Additionally, some businesses choose domain names with a .net extension for their intranet Websites.[/li]
[li].org represents the word "organization," and is primarily used by non-profits groups or trade associations.[/li]
[li].biz is used for small business Web sites.[/li]
[li].info is for credible resource Web sites and signifies a "resource" web site. It's the most popular extension beyond .com, .net and .org.[/li]
[li].us is for American Web sites and is the newest extension. It has the largest amount of available names in inventory.[/li]
[li].cc was originally the country code for Coco's Keeling Islands. It is unrestricted and may be registered by anyone, from any country.[/li]
[li].bz was originally designated as the country code for Belize, but is now commonly used by small business who can't get the name they want using the .biz extension. It is unrestricted and may be registered by anyone, from any country.[/li]
[li].tv is for rich content/multi-media Web sites, commonly used within the entertainment or media industry.[/li]
[/ul]
Rules for country codes vary from country to country - some require you to have a local connection, some don't.
Some domains have additional restrictions, for example you can only register a .ltd.uk domain if you're a limited company with that name, e.g. Only my company could register extra-connections.ltd.uk (not that I'd want to!).
"can I legally sell products/services?"
Your choice of domain name has no impact on whether you can sell things from your site. You have to abide by local laws, you may be limited by the terms & conditions of your hosting company (especially if it's free hosting), but otherwise you're free to do what you like. Of course, a domain name that suits your line of business, .com, .net, whatever, will engender more trust in your visitors and make them more likely to buy services from you.
-- Chris Hunt
