Is it legal to reside in a home that is in probate?

Yes, it's legal; the right to possession of the property is held by the personal representative appointed by the court. So it's up to the personal representative whether anyone can stay in real property held by the estate. In some cases it's good to have the property occupied. However, at some point the property will need to be sold. At that time, most realtors I talk to prefer that it be empty. So, when the house goes on the market, you will need to be out. Do not be behind the curve find somewhere to move to sooner, rather than later. Also, agree with the personal representative how utilities, insurance and property taxes will be paid. Either you can pay them, or you could pay rent to the estate and the estate could pay them.