I think that it is extremely important to have regulation, convention, and etiquette in virtual communities. Just as we have those spoken and unspoken guidelines in the real world, we should also hold ourselves to the same standards in virtual worlds. I have heard it expressed that people in virtual communities are sometimes more prone to not hold themselves to the same standards as they would in real life because they are "someone else" in an online community. Also, since online interactions do not allow people to see the reactions of others when certain things are said and done, they are more likely to do them because there is not as much consequence.
Regulation, convention and etiquette in virtual communities is not always black and white. This is because not all countries have the same norms and etiquettes as others, and anyone from anywhere is able to join these communities. While researching the topic, I read a suggestion on how to avoid this problem. The suggestion was to inform people of the regulations, conventions, and etiquette of the place they are entering. This will allow people to know what kind of area they are entering before they decide to go there and act a certain way.
SL does seem to have some type of regulation, convention, and etiquette in place. While exploring SL, I visited the beach. Upon arriving, a pop-up explained the rules that I must follow while there. The rules included: no trespassing in rented vacation units, no public nudity or sex, no weapons, no spamming and no soliciting bites.
In conclusion, I think that regulation, convention, and etiquette in virtual communities is a good thing. I would hate to see people become so comfortable acting a certain way in a virtual wold that it carries into their every day life.