The topic "modifications" is rather large and has many corners, which you seem to try to discuss in only one sentence. That's hardly possible. There are many places where modifications could be applied, as well as many purposes why one would make modifications. There are many examples of modifications which the license does not allow: software cheats (adding features to the client which expose interna), resource cheats (modifying data files to gain advantages over other players), offensive art modifications (e.g. "nude patches") ... but it is not easy to declare one rule to prohibit them all in a way which does not exclude all kind of creativity from contributors.
Very simplified, you may probably make a rule in a range between the strict and the loose limit:
a) It is forbidden to use any kind of modified software or art to play on official game servers, because it might give unfair advantage, might be offensive or might break laws.
b) It is forbidden to use such kind of modified software or art to play on official game servers which gives unfair advantage, is offensive or breaks laws.
At least in case of art, rule a) is not enforced, as you can see from GUI skin mods.
Anyway - we are already hopelessly
