So I've been thinking...and here is what I came up with:
Maybe, Like others have said, Jacob is from the future and so is MIB. Possibly from a future Dharma or organization to save the world by using the Valenzetti equation. Maybe they worked together and were friends at one point. Far into the future, people perfect time traveling and mind traveling. We know that Dharma experimented with parapsychology, so maybe MIB and Jacob were chosen because of their parapsychological powers, like when “Jacob” appeared in the cabin. It can be compared to Walt appearing to Shannon and Locke.
Ok, so, MIB and Jacob still have not succeeded in changing the Valenzetti equation, so they are sent back in time to work on it and try to get it right so the world does not end. They time travel back in time to a certain point in time, obviously before the Black Rock and live there until their time comes around again. That way, they can already exist in every point in time. That is why they never age and why they were always there. One thing about these two is that they are constants. Without the other, they would both die. So they cannot kill each other. That is the loophole that MIB was talking about.
As they live on the island, they begin to disagree. On everything. MIB thinks that regular humans (who do not have parapsycholgical powers or maybe just humans from the past) are too flawed and corrupt. Jacob has not given up on them and keeps brining them to the island by manipulating little things on the timeline to get them there.
The very first time they are sent, it is only to observe, but the whole point is to stop the end of the world and the first time around obviously didn’t work or they wouldn’t be sent back to stop it. So they are sent back over and over again to tweak little things. Like how Jacob brings people to the island. To find the right people to bring to the island and figure out how they can be manipulated to change a variable takes hard work and a lot of patience and thinking. When one thing doesn’t work, he tries another the next time around. Trial and error.
MIB really wants to prove that humans are bad. I think one parapsychological power that MIB has is he can take forms of other things, like dead bodies (Christian, Alex, Locke.) I also thinks he controls the smoke monster, which is a very complicated technical device that is controlled. I do not think it acts on its own.
I also think that MIB posed as Jacob and got the Others (Ben) to follow him. He did that just to corrupt them and prove his point. He also went as far as to manipulate Dharma and the Others to fight against each other.
Jacob, however is always one step ahead of MIB. He is more knowledgable about the island and using his knowledge for good. I think he figured out that he had to die to change the variables of the Valenzetti equation, and he manipulated MIB to kill him. So we are seeing the final step to preventing the end of the world. He figured out that the variables that needed to be in the equation were the people that he touched. Everyone else was just a pawn to manipulate to change the variables.
So, I also have an answer to the question of how MIB’s loophole worked. On lostpedia, it says a constant is an object or person that one cares about that is present in both the past and future. I think it was an object: John Locke’s compass. Young Locke did not pick it out because it was not his. It was MIB’s.
I think Locke is dead (because dead is dead.) His body was needed because MIB can take the form of dead people on the island, and also his compass was needed so he would have another constant and wouldn’t need Jacob anymore to keep him alive.
MIB just got Ben to do it to further prove his point that humans are bad.
I think Jacob is also dead, but now things can play out to where the losties become the variables in the Valenzetti Equation.