I know a stud owner who bred a bitch whose owner did exactly this. She put the dog on her website as her own. It was not appreciated by the stud owner, and she asked her to remove him from her site, which she did after a while.
I think that if you do not own the dog, then it costs NOTHING to list owned by _______ under his picture.
I too think it is good to use outside studs, there is certainly nothing wrong with that.
The reasons to list a dog as your own that is not, is to gain respect for owning such a dog, or to gain stud business for your own dogs. You can tell people who call, "Blitz" is currently unavailable, but I have "Fido" here with similar lines, etc, etc.
Frankly, I think it is unethical to list a stud without listing the stud's owner with him. However, if you have a dog, whose pedigree you are showing, and that dog is closely related, putting the dog's photo in the picture pedigree, that's not a problem.
The situation I was referring to had a page for each of their males and listed my friend's dog as one of their males. Since I bred to this same dog, I had my puppy buyers calling me and asking me if my friend sold her dog. That should never happen.
Heidi Ho, Odie
Joy-Joy, Bear Cub, Hepsi-Pepsi
Cujo2, Karma Chameleon
Ramona the Pest, Kojak -- who loves you baby?
Tiny Tinnie, Susie's Uzzi, Kaiah -- The Baby Monster.