Something that occurred to me

Modding and hacking a console game (SNES, PSX, PS2, etc...) are two terms that describe the same thing. It means alter the code or data of a game to gain an advantage or simply modify it to have a different game. Although modern games hacks use more the term modding, ROM hacking is the term that is still commonly used among the community for cartridge mods (SNES, GB, GBA, NES). Because of that, I think we should stick with the ''hacking'' term even if we do mods. In reality, using an editor or drawing sprite have nothing to do with the common definition of ''hacking''. Still ROM hacking is illegal (correct me if I'm wrong) but it's tolerated by the game industry with older games and this is part of the definition of ''hacking''.

For your second answer, I think game developers will never acknowledge modding on recent games.