Help in choosing appropriate open-source license...

[Sanjoy Mahajan]

> [3]...there do not seem to be any open-source license that deals
> with code that is run on a server-farm and not distributed.
> ...Can you recommend a license that could fit this case? 

The Open Software License handles this case.  From section 5 of v3.0
(v2.1 has nearly identical language):

  5) External Deployment. The term "External Deployment" means the use,
  distribution, or communication of the Original Work or Derivative
  Works in any way such that the Original Work or Derivative Works may
  be used by anyone other than You, whether those works are distributed
  or communicated to those persons or made available as an application
  intended for use over a network. As an express condition for the
  grants of license hereunder, You must treat any External Deployment by
  You of the Original Work or a Derivative Work as a distribution under
  section 1(c)

Section 1(c) is the copyleft clause.  v2.1 is OSI certified; not sure
whether v3.0 is officially certified but maybe the OSI board or Larry
Rosen (its author) can answer that.

> how do I go about crafting such a license?

'Talent invents, genius steals.'

-Sanjoy

`Never underestimate the evil of which men of power are capable.'
         --Bertrand Russell, _War Crimes in Vietnam_, chapter 1.