Should I use my legal name or pen name as the copyright holder?

The author name on the cover can be a pen name — that's fine and common. But the copyright holder is usually your legal name or your company/imprint, because that's the entity that actually owns the rights.

So a typical setup is: pen name on the cover and title page, legal name (or LLC) in the "© year by ___" line. The generator has a separate field for the copyright holder precisely so you can keep the pen name up top and the real owner on the copyright line. If you've formed a publishing company, using it as the holder is also common.