I'm not clear on what "stolen my ISBN and published" means. Is it an ISBN already assigned to you by Lulu or someone else? And what does "published" mean, other than posting it "for sale" on their site.
It means: I purchased the ISBN, planned to use it for the book in question, but then held off because I've been unhappy with lulu's sales. I finally decided to go forward with it anyway, but was told my ISBN had "already been used". I asked myself, "How can someone use my ISBN", but I'm guessing I mistakenly listed the ISBN somewhere on my website in anticipation of releasing the book and someone grabbed it before I used it. Alternately, they could easily search for existing ISBNs using the book title, find any not already used, and then submit their book using my ISBN. In short, "owning" an ISBN doesn't mean much if you don't use it immediately! Bowker had no clue how to prevent anyone from using ANY of my ISBNs!
To answer your other question, "publishing" means they "published" my book (or some fragment of it), because that's how ISBNs get assigned to books (it doesn't happen when the owner purchases them, assigns then or completes the ISBN data). Since it looks like there's no physical way to download the book, I'm unsure why they "published" it, or what that means, but I wouldn't be surprised if they're offering it as a Kindle Select series of books. I'll have to watch and see. However, Amazon isn't very good about locating books by title, as I'm unable to tell Amazon that I published both a print and a Kindle book through them. They're unable to "find" the books in question!
Yes, this doesn't stop me from publishing the book on lulu. However, that's at least $7.80 down the drain (the cost of the individual ISBN when you purchase them in lots of 100). If I bought them individually, it would be a $78 dollar loss.
I "copyrighted" my book by publishing it (back in Nov.), so it was clearly before this guy grabbed it from me. I also have figured out how (and why) I was targeted (I'll cover that at a later date).