The article makes it very clear where things were exploited. Especially the circumnavigation of the new token limit seems pretty relevant to the discussion of whether this was playing within the intent.

If he’d wanted, Medjedovic could now have traded $3,200 worth of Sushi for DEFI5 tokens worth $1,172,000. And had he simply done that, Indexed would have been fine. The protocol places limits on the amount of a new token that users can swap into the pool, so he would have been able to extract only about 1.5% of the pool’s value—which, given transaction fees, wouldn’t have been profitable for him.

Instead, Medjedovic’s script took out another flash loan consisting of $2.4 million worth of Sushi tokens. And rather than swapping them into the pool, it gifted them to it—a seemingly irrational move that Indexed’s algorithm wasn’t designed to handle. The “donation” overwhelmed the pool and circumvented its usual trade limit for new tokens. This allowed Medjedovic’s program to freely trade overvalued Sushi for undervalued DEFI5 tokens, then cash those out for the pool’s underlying assets, pay back the loans, and keep the rest, now worth $11.9 million. The attack on the CC10 pool brought the total haul to $16 million.