I have read many theories regarding the Loop Hole that MIB found and it seems that so many people try too hard to explain it. Remember, the show's creators want this to be accessible to everyone so they have to explain events and reasons in a way that can be understood by most people. That means what exactly the loop hole is or why it is important probably isn't terribly complicated.
My theory, and it isn't so much a theory but an observation of what happened, is that the Loop Hole was simply MiB/Flocke telling Richard to tell Locke that Locke had to die to save the Island.
This is the only instance of MiB using a dead body of a person to manipulate that same person when they were alive.
But the fact that Flocke is telling Locke (thru Richard) that he had to die is a paradox. Flocke couldn't have existed if Locke didn't die, Locke would not have died if Flocke didn't tell him he had to die. It is sort of like going back in time and shooting and killing your younger self - if you shot your younger self in the past, you never would be able to have used the time machine. That is the Loop Hole.
In the foot of the statue when meeting with Ben and Flocke, Jacob makes a reference to the threads in his tapestry and the length of time it took to make them. I believe this is a metaphor for the course of time. MiB used time travel to find his Loop Hole, to create the paradox, and unravel Jacob's tapestry.
Simply put: the Loop Hole was MiB creating and/or using a paradox, OR the fact that this was his way of getting around the "rules" that they are bound to. It is easy to dive further into this and make it more complicated and hopefully it will be explained in Season 6.
What I want to know is:
How did Locke fit into this?
Was he specifically needed for this purpose?
Why does the Loop Hole allow MiB to kill Jacob?
Couldn't MiB just have manipulated Ben into killing Jacob by using Alex?
Why did MiB need to disguise himself as Locke if Jacob could tell right away who he really was, just to trick Richard?
There really isn't enough evidence to answer those questions yet, hopefully my theory will bring people back to the point of what the loop hole is, maybe make it a little easier to understand. Of course, I could certainly be way off.
So I think Jacob was responsible for the Losties ending up on the Island, his touch when they were younger helped set things in motion.
Now that Jacob is gone and his "tapestry" is ruined, MiB will be able to make things happen his way. On a side note, I believe Jacob's death lead to the ability for Jack & Juliet to explode Jughead even though that was 30 years ago. The 2 events have to be connected - Jacob's death in 2007 (or 2008) and the events happening in 1977. I think the past was changed by that incident.
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