Update: Jane Kim from Microsoft posted a message about this issue:

Hey folks, we created the guidelines with this scenario in mind - we definitely want to support applications using the icon to indicate Web Slice content.

We will update the documentation to make this clearer. Thanks!
- Jane Kim [MSFT]

Thanks for clarifying things Jane!

Original post:
Web Slices are a cool new feature coming in Internet Explorer 8, where you can subscribe to portions of a web page and see updates to them in the Favorites toolbar. There is even an open specification for Web Slices (partially based on hAtom) so that others can implement it. Daniel Glazman has been working on a Firefox extension to implement the spec.

Just as RSS has a standard icon where a site can indicate it can be subscribed to:

Web Slices have a similar icon to indicate you can subscribe to a portion of a page when the standard is being used:

Unfortunately, the terms of service for this icon got switched around and Daniel noticed that it looks like other browsers therefore can't use it. From the terms of service for the icon:

DO NOT use the icon:

• As a logo or favicon for a Web site or online content, whether Web Slice enabled or not. The icon represents the Web Slice technology, and not the Web site or content itself
• As an application icon
• As an icon or logo for any product or service, or as a feature or design element of another icon, logo, trademark or service mark
• In any manner that expresses or implies an affiliation with, sponsorship, or endorsement by Microsoft or any third party

I'm sure this was unintentional, as often happens with licenses, since Microsoft has provided a simple standard in good faith. Microsoft should just open source the icon, just like the RSS icon was, so that there can be a standard UI mechanism to indicate to users that a Web Slice is available. As an alternative, if they want to retain control to ensure the icon is used properly, they should update the terms of service so that other browsers to use the icon to indicate a portion of the page can be subscribed to.