Yes, reselling is permitted by DreamHost.
The difficulty of setting it up will depend on exactly what method you are using to give away / sell hosting.
You can add as many domains and sub-domains as you want and these can be configured under different machine users, providing separate FTP and SSH log-ins for your users.
Providing Web Panel access is a little more difficult, but you can create Panel log-ins and set certain privileges for these log-ins.
Overall, DreamHost is probably not the best choice for general reselling, but it can be done and is allowed.
Edit: Below is a link to the reselling article on the DreamHost wiki.
Save [color=#CC0000]$50[/color] on DreamHost hosting using promo code [color=#CC0000]SAVEMONEY[/color] ( Click for promo code details )