What happens if you drive with you hubs locked all the time?

[JimJones]

Can this cause damage? What about burnouts and fishtailing?
If I remember correctly the reason you have front hubs in the first place is because when you drive on hard pavement with the hubs locked the rotational differences between the front wheels and rear wheels could damage the transfer case so you are only supsto drive with the hubs locked on the dirt. Is this right or wrong?
Can you put a locker or limited slip or Detroit locker in the front axle? And if you did so would you still need to have hubs?

I was watching this vid

http://www.youtube.com/watch?v=VF2lg06Xfh0

And noticed that this truck has center caps on the wheels that cover the hubs. That is what prompted this question.