It's just a look. People may like that look, I don't understand why people keep their cars standard but wouldn't ever mock someone for doing so.
No such thing as "illegal" stretch (although you might attract unwanted attention from the boys in blue). You can have illegal amounts of rim poke (think it's 25 or 30mm outside of the arch, while the tyre tread itself has to be within the arch.
Not true.
Tyre manufactures approve a certain width of tyre to be on a certain width of rim.
Falken have always been well liked within the "scene" community for decent tyres which actually grip relatively well, and stretch very well.
They were the only (I think maybe Toyo did as well with the T1-R) manufacturer to certify a 225/40 tyre on a 9.5 rim, much to the joy of the VW community in general.
If you were pulled over, you could produce the data-sheet from Falken and you would be good to go. Police could not do you for anything.
HOWEVER, if, and I'm only being really picky here but it's completely true, you fitted a 205/40 onto a 9.5, and this was NOT certified (which it isn't), then technically you have fitted an innapropriate size tyre to the rim against the construction®s (or some other far unknown rule) and this would be illegal.
Stretch in itself is not illegal. It's fitting a tyre outside of the manufacturers specification which is.
As for poke you are allowed 30mm from the furthest point of the arch outwards to the furthest edge or lip of the rim.