First off I see that sfml is integrated with openGL, does this mean that anything I can do with openGL I can do with SFML?
Of course not. SFML is simpler than OpenGL, which means it has less features also.
SFML is focused on 2D stuff, it doesn't have any of the 3D features of OpenGL. If you want to make a 3D engine, you should do it on top of OpenGL.
Would there be any legal issues with doing that?
You can use SFML for anything, closed or open, free or commercial. The license is very permissive.