Guns. Drugs. TOR. Child pornography. The long and twisted tale of LowEndTalk's famous member William goes deep.
William Weber, a LowEndTalk member, was raided by Austrian police in 2012 for operating a Tor exit node that was allegedly used to distribute child pornography. While he was not arrested, many of his computers and devices were confiscated. He was later found guilty of supporting the distribution of child pornography through his Tor exit node, though he claims it was unintentional and he was simply supporting free speech and anonymity. He was given a 5 year probation sentence but left Austria shortly after. Though some articles portray him negatively, it is debatable whether he intentionally supported child pornography distribution or simply operated in the legal grey area of Tor exit nodes.
You don't need an exit node to browse Tor hidden sites. Acting as a relay middle node is also not a problem.
Exit nodes are kind of a "plausible deniability" thing for Tor users from places where using Tor might be frowned upon, but otherwise you can find anything you may want to use Tor for, on hidden sites themselves.
For as much as I'd like to help the Tor network and the idea of free speech, articles like this are why I'd rather let the CIA and other national sponsors take the brunt of running those exit nodes.
Tor hidden sites are hosted on Tor nodes, so you don't leave the Tor network to browse them.
Anyone with a Tor node can host a hidden site, and there are some more or less famous ones around. Some open web sites keep a hidden one as an alternative in case their domain gets taken down or blocked for whatever reason in whatever country.