The way I understand it, ZIL at Infocom was a
subset of MDL. More specifically, a subset that was easy to compile to the Z-machine. This means that during development, they'd mainly write ZIL code, but they'd do it
in MDL, giving them access to the full powers of the Lisp during development. (Since MDL is an early Lisp.)
Sometimes during game development they'd make use of MDL macros that were not available in ZIL, and they'd then have to either macroexpand manually, or hard-code those macros as language features into their ZIL compiler (because ZIL is not quite a Lisp and does not have support for custom macros).
Again, this is the understanding I've pieced together in my head from various sources. I don't have the full picture! Maybe I should try to get in touch with the people who were there to ask them...