Nvidia wouldn't have prohibited people from using GeForce cards in data centers if people weren't do it.
As for nVidia banning it, if you've the cash you can buy cards, just becomes painful. nVidia were doing it more because the GPGPU demand was choking the supply to graphics customers, and later dumping obsolete (for crunching) cards on the market en masse, interfering with the mid-tier card sales channel.