If you're someone like a back-end programmer, where in depth knowledge is the whole thing, you're not going to get hired based off of a mod you work on unless it's one hell of a mod that effectively rebuilds the game, you're going to get hired through coding tests or through back-end work, not front facing art or level design which you wouldn't do in the actual job.

Strong disagree. A mod is just as important a portfolio piece as anything else. "Coding tests" are less a measure of skill and more to weed out unqualified candidates, which is why you tend to see a lot more of them for junior developer positions.

Second, I'm not sure there's such a thing as a "back-end" developer in gamedev outside of teams who manage multiplayer and other online infrastructure.

while having that knowledge before hand is great, they're going to boot-camp you through their workflows anyway so it doesn't save all that much time.

On-boarding a new developer, as a rule of thumb, takes about six months. Going in ahead of time knowing many of the quirks and oddities of your proprietary engine is going to be a huge boost. As you say, having an eye for programming is very important, but you can't have an eye for something you've never used.