I'll start by saying this: I don't fundamentally approach games as a private space. They're taking place online, where no reasonable expectation of privacy really can exist. So, by extension, if its online anywhere, its not going to be private because by its fundamental nature, it just can't be.
What you are doing by logging into games is taking part in a sort of calculated risk. You're essentially acknowledging that in order to participate you're giving up your claim to true privacy in this matter and that the benefits of a good story and some fun times outweigh your need to keep it all beyond the notice and evaluation of other people.
And that's just kind of life, y'know? You give to get something, no matter what it is. And if you don't want something to be shared online, in any online medium, don't do that thing or say that thing or share that thing.
This is not justifying spying, persay but I do think its important to define what we mean by spying and privacy on games. Dark staff in a private room on grid watching two players typesex at each other? Yeah, that's fuckin' creepy and inappropriate and a violation of a certain fundamental trust that players assign to staff to demonstrate that they have good judgement and not do shit like that. And that to me is really what we're talking about when we negatively talk about privacy and spying on games:
We're basically saying that the staff on this game doesn't have good judgment, which is to me a much bigger problem than just dark watching people typediddle each other.
Watching actions as they take place in IC areas, either as a visible staff member or a dark staff member? I'm less bothered by this. You're in a public grid space on a game and much the same way backgrounded NPCs who are assumed to just be in public ICly with you; it seems odd to me that you draw the line at staff not being allowed to be there and be a bystanding witness to shooting fireballs out your eyes or whatever it is you're doing in a public space.
Years ago, I was staff on a game where NPCs could be used to watch goings on in game. The reasons for that were related solely to this game. It was a RP-enforced MUD and players had a relatively frequent habit of attacking NPCs for their trash drops. It got to be a big problem because while it was a MUD; it was consciously and explicitly designed not to function that way. And that wasn't some unspoken thing. It was written into game policy, so players knew what they were and weren't getting into.
So, when the NPCs were modified to allow for 'spying', it was to monitor people abusing them. The NPCs also were written to defend themselves if they were attacked, but never instigate an attack. (Well except one but the NPC was actually nuts, all its environmental messages made it clear that it was nuts, and that if you molested it, it was going to attack you.) If we were feeling up for it, staff could also control the NPC to RP with people. The players actually liked this because you never knew what you were getting: a dark NPC or a staff piloted NPC who might do more than deliver a few repetitive action messages or muttered character phrases at you before they sold you something or whatever their basic function.
Occasionally, you'd forget to turn off the ability to watch through the NPCs. I never kept it on all the time because many of the NPCs had an IC grid circuit that they wandered and it was spammy as fuck. I'd also like to note that these NPCs never went anywhere private unless a PC player grappled and dragged them into that grid space. And we'd basically have to tell players not to do that and port the NPC back on to a public grid square to resume its wandering around on a limited route.
And occasionally, I'd see things that I didn't want to see: people boning each other ICly in public cafes or bars or stores was usually the thing no one wanted to watch. Places where anyone can walk in at any time for any reason and see this thing going down. So to me, if you're going to get up to something that you shouldn't probably be doing in a public grid space, then... you can't really get weird about being watched.
YMMV.
