It's worth noting that WoW addons also backfired at certain points but for different reasons. Example being AVR that drew shapes over the 3d world marking boss mechanics, essentially trivializing them and leading to Blizzard locking out that API entirely from addons. It didn't affect other users, though gave a competitive advantage to some.

And there is a hell lot of complaints about cheaters on hypixel, no?

Does squeenix explicitly allow FFXIV mods now?

Ehhh. I'd say they tolerate it.

Their policy is basically "Don't Ask, Don't Tell". So as long as you aren't yelling at people about DPS meters or streaming with obvious mods, they'll leave you alone.