As far as I know the rival product has plenty of ability to program in keystrokes and all manner of naughtiness that could get you banned
My, that's a big stick you're beating a very dead horse with.

but still.... is there a delay actually programmed into keyclone, or is the delay caused by the program "waiting" for the OS? I think that as long as the delay isn't configurable and the program isn't reading anything from wow memory, blizz won't have a problem with it.
While I agree that it probably isn't programmed in and therefore wouldn't be against the ToS, a delay of 3-5 seconds for an action that for all rights and means should be instantaneous is the mark of flawed code.