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Sitecore puts a constraint on the number of CM and CD servers that a license can be used for.
Suppose a Sitecore license is only applicable for X number of CM servers and Y number of CD servers. Does this mean that I can only install Sitecore on X number of machines?
Just to add onto what @MarkCassidy said, if you have a Partner license for development that is separate from your client's license, the limits imposed by the clients license do not prohibit the developer from installing as many development instances as are necessary up to the limit imposed by their Partner license. In this case, a "development instance" is basically any instance not available for public access or client access.
When you install any instance, it must installed with the license that it applies to. Thus, if you install a development instance against a Partner license, it must be installed with the partner license and not the client's license.
The rule of thumb is that if the client can see the site then that site must use the client's license. As such, so long as the site is inaccessible to the client and the general public, developers may install as many instances as are necessary (up to any limits stated in the Partner license) without being in violation.
Again, like Mark said, there are further restrictions that aren't included here and this answer should not be regarded as legally binding in any way. This is merely meant to be a guide to help point you in the right direction. Please defer to and confirm all information with your Regional Sitecore Sales office or Sitecore Representative.
Yes. You can only run as many instances of Sitecore as your license permits. What that is exactly, differs from case to case.
Instance means "Application" really. As in one IIS Application / AppPool.
If you need licenses for QA, Test, Dev and so on - these need to be purchased separately. Usually these go at a slightly lower rate (Dev ones, at least) - but I am no expert on Sitecore license pricing. You need to contact your Sitecore Partner Manager for questions on this.
There are further restrictions to a Sitecore license that aren't included here. Don't regard this answer as legally binding or anything, I am not a lawyer.
I'll preface this with stating I am in no ways a lawyer nor an expert in Sitecore licensing, but I believe from my experience the answer to the question (as stated) is "No".
Based on a license supporting X CM and Y CD servers, typically you should be able to install Sitecore between X and X+Y times. Also, your installations may not equal your number of machines (physical or virtual) if you install multiple instances on a single server, or go beyond the typical core limits on a given server.
However, you will only have a maximum of X Sitecore master databases. Essentially, you have license to have X separate Sitecore topologies, which you can then use your Y CD servers for as you need to.
