By Patrick Lannin and Mia Shanley
STOCKHOLM (Reuters) - While WikiLeaks founder Julian Assange battles to stay in Britain, Sweden is incensed he has belittled one of the world's most respected justice systems and questioned a nation famed for welcoming - not extraditing - political refugees.
Assange, hiding from arrest in the Ecuadorean embassy where he has been granted diplomatic asylum, says he fears the United States will try to extradite him if he goes to Sweden for questioning over allegations of rape and sexual molestation.
Assange's speech from the embassy balcony on Sunday focused on what he saw as his persecution by the United States, but did not mention the rape allegations.
Assange's accusations have infuriated many in Sweden, who say the stories of two women who made the sex crime allegations have played second fiddle to unwarranted theories of a U.S.-led conspiracy to extradite him with the help of allies in Europe.
"Assange has evolved into a megalomaniac rhetorician, who seems to have very little contact left with reality," Sweden's Svenska Dagbladet daily said after his embassy balcony speech.
Another newspaper, Dagens Nyheter, said the legal process had to be followed through and defended Sweden as a nation that upheld the "rule of law".
After Ecuador granted Assange asylum, Swedish Foreign Minister Carl Bildt wrote: "Our firm legal and constitutional system guarantees the rights of each and everyone. We firmly reject any accusations to the contrary."
Along with other Nordic countries, Sweden sees itself as a legal safe haven and it has welcomed thousands of leftist refugees from dictatorships in Latin America in the 1970s to Iraqis fleeing the U.S.-led invasion and war after 2003.
The World Justice Project's Rule of Law Index 2011 report ranked Sweden first of 66 nations on fundamental legal rights.
THE RAPE CASE
That does not mean the rape accusations have not been criticized. Assange faces questioning over incidents with two women that involved a degree of consensual sex and other acts some critics say would not be called rape in other countries.
Evan well-known feminist Naomi Wolf criticized the international judicial hunt for Assange, writing that she personally knew "1.3 million guys" with similar complaints made against them by women.
A first prosecutor opened an investigation in 2010 on allegations of rape after two women with whom Assange had sex reported him to the police, only to drop the rape accusation and pursue less serious allegations. Then a more senior prosecutor reopened the rape case a couple of weeks later - giving fodder to Assange's supporters who see a conspiracy against him.
Assange had sex with two women within days of each other during a visit to Sweden in August 2010. Both women went to the police after having had sex with Assange, wanting him to have an HIV test.
In the case of the first woman - who helped Assange arrange his visit to Sweden - he is alleged to have held her arms down physically and spread her legs during what Assange says was consensual sex in her apartment, where he was staying.
With the second woman, he is alleged to have had sex with her while she was asleep and without wearing a condom after consensual sex with a condom, according to copies of the police questioning of the witnesses, of which Reuters has a copy.
The prosecutor's office has sought Assange for questioning over suspected rape to a less severe degree, unlawful coercion and two cases of sexual molestation.
The rape allegation is the most serious and if proven in court could lead to up to four years in jail.
The lawyer for the two women stood by the allegations and criticized Assange for not coming back to be questioned.
"It's an abuse of the asylum instrument, the purpose of which is to protect people from persecution and torture ... It's not about that here," Claes Borgstrom told Reuters.
"He doesn't risk being handed over to the United States for torture or death penalty. He should be brought to justice in Sweden. This is completely absurd."
At the same time, Assange might not have that much to worry about, said law professor Christian Diesen. He noted that in practice nine out of 10 cases of alleged rape are dropped by prosecutors before coming to court.
"But where there are no witnesses, no pictures and no technical evidence, only the accusation of the woman against the man and he says that sex was consensual, then normally the situation is that the word of the woman will not be enough for a conviction," Diesen told said.
Assange's supporters say that the United States is preparing a grand jury indictment in Virginia to extradite him and point to the fact that Swedish prosecutors have refused to travel to the United Kingdom to question Assange, as well as refusing to discount any extradition. No public request for extradition has been made by U.S. authorities.
Swedish courts make the decision on whether someone like Assange should be extradited. The government can still reject a Supreme Court decision to extradite but cannot force an extradition if the court says no to the petition.
But Swedish legal experts said any extradition to the United States would be a complicated and long drawn out process, whose success is far from certain. Assange's fame would be an obstacle.
"There would be a storm in the media worldwide stopping any extradition. That would be the best guarantee he would have, together with the formal conditions," said Sven-Erik Alhem, a former prosecutor and a commentator on legal matters in Sweden.
Anne Ramberg, secretary general of the Swedish Bar Association, an organization of practicing lawyers, said Sweden could not send someone to the United States if that person faced the death penalty or if the request was for a crime deemed to be a political crime.
"The risk that he would be extradited from Sweden, in my opinion, is very, very, very small. In any case, it is not a bigger risk here than if he is in England," Ramberg said.
But Sweden's record is not always so clean.
Supporters of Assange point to Sweden going along with the CIA in 2001 in sending two men to Egypt during the U.S. spy agency's anti-terror campaign.
Both men were later released and given 3 million Swedish crowns ($450,000) in compensation from the Swedish state.
Ironically, the U.S. State Department in its 2011 human annual rights report also criticized Sweden for keeping prisoners in pre-trial detention for too long and said prisons subjected detainees "to extended periods in isolation and limited their access to visitors, mail, and exercise".
For Assange's supporters, any extradition risk is too much.
"We know for sure that the risk is not zero. But how big the risk is - if it's 10, 20, 50 or 100 percent, nobody knows," Per Samuelsson, Assange's main Swedish lawyer, told Reuters.
($1 = 6.7077 Swedish crowns)
(Additional reporting by Simon Johnson; Editing by Alistair Scrutton and Giles Elgood)