Selling a handmade wooden horse painted as the classic valley horse is not illegal. The Dalah horse as a symbol is not patent protected. The reason is, according to the Patent and Registration Office, that it is not possible to design the horse because the horse shape is not unique.
The pattern on the horse is also a traditional pattern where there is no author. The rules say that copyright is only valid for 70 years after the author's death, so even if an author existed, copyright had expired long ago.