In example:

If someone sells homemade ice cream where they have crumbled oreos and mixed in to make homemade Oreo ice cream, but generically named "Cookies & Cream"

or

If someone uses Great Value knockoff of M&Ms in their homemade cookie dough, and sells it as something like "Rainbow Chip Cookies"

Is this legally ok to do?

If not, what would it take to be in compliance?

In example:

If someone sells homemade ice cream where they have crumbled oreos and mixed in to make homemade Oreo ice cream, but generically named "Cookies & Cream"

or

If someone uses Great Value knockoff of M&Ms in their homemade cookie dough, and sells it as something like "Rainbow Chip Cookies"

Assuming someone has the basic business licenses (to sell food):

Is this legally ok to do with just the basic business licenses?

If not, what would it take to be in compliance?

Per fetweet's comment, I've added his questions which may help to answer the initial basic question.

1. What are the guidelines per the FDA, for food related ideas? Does the FDA have anything to do with non-food ideas?

2. Does a branded product that is used as an ingredient have to be listed as an ingredient with its branded name? What about in non-food ideas? What's the procedure for legally listing these branded products as ingredients with their branded names? Couldn't the branded ingredient be bypassed in being listed in the main product by using the ingredients listed on the branded ingredient instead?