Ethical Directory Practics

I came across a site, that seems to be a directory but the odd thing is that most of the sites that have listings are copied there in their entirety.

The nav bar links all direct you to pages belonging to the site that is listed which are under the directory url. Has anyone else seen this type of directory? Is it ever ethical to have another site's pages copied in this manner? Could this result in serp problems?

 

those pages are just the actual urls displaying in a frame

 

The sites are not copied, they are opened in a frame.