I'm going to guess the "mod = hack" comes from people adding mods to the client, to do things like change textures to make them partially transparent, letting them see the enemy before they see them.

This stems from online games having to send an enemy player's position and expected movement, before they do it, so the user's client can render it in time. That means enemies get spawned into a client scene before the user sees them, then the client manages visibility,.and sends the user's actions so the server can determine the results.

Making walls partially transparent on the client, allows things like predictive aiming to shoot at an enemy just as they become partially visible but before they can see you on their client with opaque walls, giving an unfair advantage.

Other mods would allow a client to automatically parse the enemy's position, auto aim and auto fire. They aren't hacks as long as they use the game's official API for mods... and some games did expose that data to mods, making unfair mods possible.