It is not illegal at all. The worst that will happen is you might get hassled until they figure it out. Ask anyone who has ever built a kit car. In the late seventies I built replica Porsche Speedster on a '63 VW pan. I once sat handcuffed on the curb for about a half hour by the LAPD until they figured out it wasn't a real Porsche. The registration I handed the cop was for a 1963 VW.