You agreed not to use profanity, or masked profanity, in game. This has been the case since 2004, even if you were not aware of it. Blizz reacts to reports, so it is up to players to decide if they want to report something. Regarding the filter, no, it does not mean you can break the rules. Spotlight on: Harassment
Mature Language Filter (aka The Profanity Filter)
This can be activated within your Interface Options: Main menu (ESC key by default) Click Interface > Social and check - Mature Language Filter.
Once enabled, all inappropriate words in our profanity database will be filtered and masked to appear as jumbled characters, such as ‘*##@&’.
Note: The filter does not excuse the language used. The filter serves as a temporary shield, to help parents of minors and others who do not wish to see it, to block it. Our policies prohibit the use of both clear and masked inappropriate language.