You can use Arduino to make a commercial product following some simple rules.
* if you have made your circuit as a derivative of the Arduino board you must release the design files with a CC-BY-SA license like the original cad files
* If you build your circuit as a shield that plugs on top of an Arduino board all the circuit is yours and you don't have to release anything
* The programs written on Arduino are yours. if you have modified the core files or one of the libraries you must make your modifications available to everybody
* You can call your product in any way you like as long as you don't call it Arduino
* If in the documentation for your product you want to write "Powered By Arduino" that would be appreciated
* There is no revenue sharing for any derivative work (unless it uses the Arduino name see http://www.arduino.cc/en/Main/Policy
having said this.
The code on the Arduino can be read after it has been programmed.
It will be available only in binary form but can be programmed on another board (i.e. copied)
There is a "fuse" that you can burn that will make the code unreadable but it will also make it hard for you to update your code once it's on the board.
If you patent something you have to do that in every place in the world you want to protect your idea. the more countries the more payments
Patents reveal your idea to the whole world.. some people don't patent so they don't have to provide any detail about their invention
PS you can't patent Arduino
PPS You should email us at team (at) arduino (dot) cc to let us know what you're building. We're always interested in hearing what people are doing with Arduino