I'm sorry maybe I'm misunderstanding, but where does it mention anything about emulators? You cite the "breaking the law" section which goes as follows:

Breaking the Law

You must respect all applicable local, national, and international laws while using our services. Any content or activity featuring, encouraging, offering, or soliciting illegal activity is prohibited.

First of all, I really doubt this blanket statement has anything to do with emulators, it's seems to me like it's more of a catch-all statement to cover themselves in case something legitimately dangerous is going on. Second of all, emulators are not even illegal, pirating games is.