Earlier quoted context omitted.
I would assume that by some point, if one of his cars won, the officials just took the whole thing apart to find out what sort of bizarre loophole he'd found that met the letter of the requirements while totally violating the spirit. His antics weren't secret, even at the time he was working. He was just really good at it.
And nobody considers that dishonest? It's cheating in the spirit of the rules if not the letter of the rules.
It's quite literally a major part of what makes the sport interesting. Yes, driver skill matters, but an exceedingly creative crew chief (see Smokey) is worth quite a bit more.
Some of it is certainly "cheating, good luck catching us." Some of the trick throttle body restrictor plates that look like a perfectly valid restrictor plate ("A hole of X diameter to restrict airflow to the engine so everyone has the same power") end up flowing a lot more are pretty clearly cheating - they're against both the letter and spirit of the rules, but you have to catch them, which is hard.
Others? It's literally just undefined areas. To borrow a few of Smokey's antics, sure, the car has to be based on a stock car you can buy - but does it have to be dimensionally identical, or can you get creative? He did things like create smoother windshield/frame junctions to reduce drag, extended the bumper down to improve aerodynamics, etc. Is that cheating, or is that just creative optimization within the rules? You were, at one point, allowed to use an alternative frame for the car. As worded, that doesn't prohibit a custom made frame with the drivetrain offset to one side for balance improvements for circle track duty... but is that actually cheating? It never said you couldn't.
One might reasonably assume that a fuel line routing would be "a more or less direct and protected path from the fuel tank to the engine." But, if you've not specified this, and someone stuffs the frame rails with a couple gallons worth of spiraled fuel line... the requirements specify fuel tank capacity. They don't specify fuel line length or capacity. So if you stuff a ton of the largest diameter fuel line you can get your hands on in just about every frame rail and it doesn't say you can't... well, is that cheating?
The rules have gotten more strict over time, but there are still plenty of creative ways to use the provided parts. A few years back, some team found some way to use the provided suspension components, within spec, to meet the ride height requirements at the start of the race, when it was measured. They were consistently lower than they ought to be at the end of the race, but they used the provided parts and met the requirements, as written, at the time they were racing. I believe the letter they got was essentially, "We can't figure out what you're doing, but stop it, and we're going to start checking ride height at the end of the race, here's the tolerances." They met every requirement provided, but found some way or another to get an advantage.
And that's just NASCAR. You get into F1 with "functionally unlimited budgets" and some of the engineering insanity that is entirely within the bounds of the rulebook, but is still wonderfully absurd...
Stuff like "You never said we had to race with the physical engine we qualified with, so our qualifying engine is run at the literal edge of holding together and we replace it before the race." I believe it was BMW that got around 1500hp out of a 1.5L motor (so 1000 HP/L), but the engine more or less came apart at the end of the qualifying laps.
Can you water cool your brakes? Well, OK, nothing against it. Whoops, did you water cool your brakes so much you're underweight during the race, but refill the tank before post-race weigh in? Well...
Far as I'm concerned, this is the sort of thing that makes racing interesting!