Bruce Schneier has also written on this with Blizzard: https://www.schneier.com/blog/archives/2005/10/blizzard_ente...

It's not a new topic, and not one with great answers. On the one hand, any PC gamer knows cheaters ruin multiplayer games, and developers need to participate in the cheat/anti-cheat arms race to ensure the integrity of competitive play. On the other, it's the definition of spyware.

Unfortunately, the state of the art answer is "if you don't like it, you don't have to play the game." It will be interesting to see how this plays into the inevitable changes to law that will happen.