My read of the "side projects and experiments" part of the blog post is that, in the context of LLM projects, if your project does not use resources and isn't looking to attract a community then, if only due to the practicalities of moderation/enforcement, they're unlikely to take any action against it because it won't be visible or causing enough problems.

Asking about this, it seems like that might be the case: they likely intended the "even if they were not LLM-generated" to be counterfactual. It's an unfortunate place to leave such grammatical ambiguity.