The reason it's been classed as one is because these weren't legitimate hostnames, they weren't cases of people buying a domain and pointing it to TF, those individuals were un-banned and apologies issued. In these cases individuals went out of their way to spoof hostnames locally and pass false information to the server, which is why it's been classed as an exploit, and quite clearly is not the behaviour we intend. Due to the amount of time it then took to remove these (In some cases quite offensive) hostnames, bans were issued accordingly.
So we did not use an exploit in the sense of a software having a vulnerability but in the context of abusing said software to create fake host names resulting in bans issued because of the inconvenience to clear said host names from the database?
You (and others) went out your way to create fake and in a lot of cases offensive hostnames that were in no way shape or for real or possible to be real. It creates false information and is abusing the way in which the system works to create a non-intended result (Hence an exploit). Bans were issued because they were often offensive and because you were doing something that was not the intended function of the system.