Staff being able to spy on players is common, players being aware of it may be less common, and staffers without any coding experience being aware that they could potentially have this capability may also be less common.
There are often good reasons to spy on players, and this often considered a breach of privacy.
Privacy is a debatable commodity on a MU* when you can take your private OOC conversations to Discord, much the same way tabletop RPers can take their private OOC conversations into another room that the GM is not responsible for.
2020 is a very different time than 1997, and people appreciatedemand transparency, often to the extent that it is detrimental to a game's setting, theme, and ambiance if staff allows their vision to be trampled over for the sake of said transparency. (Most do.)
I'd advise that you put the policy back in place, else this thread WILL come back to bite you in the ass at some point, and the accusation WILL be that you obfuscated your spying. Not worth it.
Policy + Clarification, and an outline of what complaint procedures are, including whether or not people are issued warnings that they're being observed, how long the observation period will be for, and so on. If someone is worthy of being spied on 24/7 forever, just ban them. You're making too much work for yourself, especially for a manual labor-intensive code-lite game.