I'm not going to delete that one, since it would have been OK if that post and his post just afterward were combined. That they're separate posts doesn't really matter. The purpose of the rule is to force all participants to constantly contribute to the discussion, which hugolp was clearly doing.
Anyway, you should report all posts that you think are wrong, regardless of whether the poster is a mod/admin. (Hugolp was not a moderator at the time of that post, however.)

Heh, now I feel a little foolish. If hugolp wasn't a mod at the time, my little example is pretty much invalidated. While I don't agree with your "proximity exception" line of reasoning, I do recognize that you guys have to make judgement calls...and yours was proper in this case. So, I stand corrected.
Thanks for your reply, and thanks for setting out the rule on off-topic posts and taking steps to enforce it. Despite my venting here, I do realize you guys have a difficult and often thankless job, and I appreciate your service to the forum. It should be apparent that myself and others in this thread support what you're doing - we'd just like to see more of it!