This is very specific as to what types of third party software is usable, or developable for that matter. I wanted to know what I am permitted to use and develop; namely, if i create an addon that modifies memory in such a way that DOES NOT monitor network packets, nor make the game playable in a way that is a "cheat," such as automated actions that are normal, would that be okay since that is not outlined in this clause in the EULA?
Yeah, no. Creating automation software will probably get you permabanned just like it would with any other MMO.
This is pretty much covered by the "playing in an abnormal manner" part because using external software to play the game for you is pretty freakin' abnormal.
When they mean "playing in an abnormal manner," they're not talking about playing with your toes or upside down. They're talking about stuff like this.