Blizzard doesn't really ban in Diablo for exploiting. There's been multiple leveling (Azmodan and ZK quest chaining) and invulnerability exploits (Diamond Skin/Mantra of Healing/Smoke Screen) since launch. Though this is the first I've seen that requires a race condition.
Diablo 1 had a great dupe bug that exploited a race condition as well (not overly relevant, but was fun once you were able to do it). Drop gold or an item on the ground you wanted a copy of, then walk a few steps away from it. Click on the item to pick it up, and time grabbing a potion off your belt to coincide with the item pickup. If you did it right (fairly difficult to time at first), you would be holding a copy of the item rather then the potion you pulled off your belt.
Diablo 2 had similar dupe timing issues involving the trade window. After it was patched they didn't ban anyone (slight lie, there was some banning of people duping, but it was very sporadic and inconsistent - seemed to be mostly accounts that did other naughty things), but would look for duplicate item IDs (every item had a hidden unique identifier) in game and delete the items when two matched. They DID ban for trade
scamming... eventually. And you had to scam a LOT of people for them to care if I recall correctly.
The hardcore (in both senses of the term, esp in regards to leveling exploits) crowd generally finds and exploits these as much as possible for quite a while before someone leaks the details. Then hundreds of people who read the right parts of the Internet start trying the exploit/heavily farming it. Blizz patches in a few days after it becomes public knowledge, and everything gets a bit cheaper for a while until the economy recovers (well, not really, the flippers on the AH will buy up anything undercutting too much and relist - eventually you'll get a bit of a clearance sale when they try to unload a backlog). I'd be a fan of them banning for abusing an exploit, but it's probably difficult and a major support headache to draw the line of what constitutes abuse versus "checking out what happened" (and the myriad other UNBAN ME reasons they'd receive) for thousands of your active playerbase.
Now once PvP is out, and there's direct competition with other players (technically you wearing all perfect gear and farming A4 Inferno really means nothing other then you might put a few more items on the auction house - which demand will float up to a proper price range because you still won't be flooding the supply), they might be more aggressive about such things, but who knows.
Edit: Check out the date on this vid [http://www.youtube.com/watch?v=dBB093Pkw2Y]
