What a great way to introduce yourself to a potential new host. At least it's honest!
That's a question for DH staff. This is primarily a customer-to-customer forum and, while they occasionally stop by and sometimes comment, DH staff generally does not answer questions here.
You can reach DH via this contact form.
Information on the DMCA is not at all hard to find; it's all over the web and there are many excellent resources for helping you "understand" the law.
That's completely understandable. You are the account holder, and under most hosts TOS you are responsible for any/all actions of your users.
It's not really reasonable to expect a host to "police" your users for you, though I'm sure some will. Have you read the Dreamhost TOS? Most of your questions are actually answered there. The TOS says they have the right to terminate your account, immediately, without refund, for violations of U.S. copyright law. If you are now asking what they will do if you break the rules, I think it's a pretty good indication that you don't plan to follow them anyway.
At any rate, it can't hurt to ask them directly if they will really close your account if you break the TOS..who know, maybe they'll tell you to go for it!