I'm looking around for a free web host, and I'm not quite sure if I can talk about hosting XenForo on a free web host as it seems illegal, so does anybody know of any free XenForo friendly webhosts?
If you could afford the $140 for the license I'm sure you can afford the around $5-7 a month for shared hosting. Most "free" shared hosting won't adequately support it.
You cannot have Xenforo for Free, there are free web hosts, and nothing illegal about those, regardless where you host, free or paid web host, you must purchase a Xenforo license first if you wish to use Xenforo.