I would agree, if it wasn't for the fact that for him to start a 'somewhat edgy storage service' guarantees him publicity, investors and the love of 10s of millions of Megaupload users (and probably a few nice millions of $$ no matter the outcome)

Easier if you're starting from zero, but he already knows this way and a lot of his ego must be wrapped into this corner of the digital world. I don't believe he made an entirely rational cost/benefits decision with this.

I'd guess avoiding lawsuits is secondary to his other motives, which aren't necessarily characterised by "make money fast, safely".