In my opinion if the seller is saying modded only, it doesn't have to be considered modded for piracy, the are lots kind of mod including case mod for one of the example.

If its written only as "modded console", what goes behind the scene is beyond LYN responsibility. So I guess it can be permitted. Unless LYN require the seller to state what kind of mod for that console. But why bother if LYN is not affiliated to Microsft nor been fund by them to counter piracy for their stuff.