The point of that rule is that certain mods are viewed as "hacks" (i.e xray). Those are useful for single player, where there is not a server that's involved. There's not any real griefing occurring because of that. It does not make sense in our view to disallow those types of mods.
The rule exists to prevent someone from uploading a mod that is *directly meant* to harm a server, i.e spamming it. Generally, it's how the mod presents itself. If it says "use this on a server to grief it", that violates the above rule.
We cannot prevent users from doing things with those mods, but we do not believe we should be disallowing them because of a potential use of them, which can be countered by other means. Mojang (or rather Notch at least back in the day) took the stance that it is up to server owners to counter those mods as well, which is the stance we also took at the time, and have not really had a reason to reconsider it.
It is up to the mod makers to really make their mods not work on servers, if they feel it has to.
A lot of that rule can be considered a case-by-case judgement call on if the mod violates, but it would generally fall down to how it presents. Naturally, if you make your mod sound malicious, changes are it's going to be removed. If you make it sound like it's nice for the single players (which I generally play as for example), then it probably won't be.
No, because they were violating the EULA in that they were sharing pre-compiled versions of the game. That rule still stands on this forum, and we enforce it. They were not taken down just because they were hacked clients, it is because they shared Minecraft as a whole, which is not acceptable.
EDIT: Adding as a reference as well of what can be considered designed for griefing:
If you hide your mod from the mod list (and it is intentionally done), then we consider that griefing, because it's of malicious nature. That would be an example, and we have removed mods that do that. Hiding a mod from servers is something that would fall under the designed for griefing mindset.