All I'm really trying to say in those policies is, "Let's keep our teachers ethical, and let's not change Rowlings' main characters beyond recognition.
But if the students are adult and graduated, then having relationships with former students isn't unethical; it just makes me personally think, Eww.
As for slash, my main thought was that I didn't want scads of people coming in wanting to do Harry/Draco, Hermione/Snape, or whatever. But I don't think the flavor of this game would appeal to those sorts of players, anyway, so why even bother to have the policy, at all? I even state that I don't mind Rowling's relationships changing in-game, as long as it's justified by story. So I might as well just have everything be flexible. I just wanted to explain up front the sort of game I'd like for this to be.
I think I'm starting to ramble now, so I'll shut up and reread this post, to make it more coherent and less babbly. (g)