This is relieving after the tempest in a teapot created (I helped) last week.
Ars has a detailed writeup about what is restoring modded G2. Apparently, it’s just a NAND lock, similar to ones found in other devices like the HTC EVO.
I guess this is what Steve Kondik, a.k.a. @Cyanogen, meant when he counseled against calling it a rootkit.
This is an interesting read that also covers some of the licensing implications that puzzled me.