There is no grey area, none whatsoever.
This is an addon in direct violation of the WoW User Interface Add-On Development Policy
1) Add-ons must be free of charge.
Furthermore it explicitly states
Developers may not create “premium” versions of add-ons with additional for-pay features, charge money to download an add-on, charge for services related to the add-on, or otherwise require some form of monetary compensation to download or access an add-on.
Notice “additional for-pay features”, “charge for services related to the add-on” (like for access to a 3rd party resource that provides the full addon)
It just hasn’t gone on Blizzard’s radar enough to explicitly ban or break it like it has done with AVR, oQueue, one version of Carbonite (for breaking both the for pay and obfuscation clause).
This one is also using obfuscation to hide parts of its “licensing scheme” and that’s part of the demo version distributed on Curse.
TL:DR;
- The addon shouldn’t exist in its current demo/trial + pay for full form
- If you can acquire the full version for free you are doing nothing more than returning things to their proper state.