This kind of drama is an incredible waste of time, and absolutely should not be allowed to cross over into Less Wrong proper. Still, since this post exists, I guess I'll contribute my position.
Whether the kick and ban was warranted should be the question for discussion. Not the concept of moderation itself. Moderation policy is and should be established by precedent and discussion, not operator fiat.
The discussion going on between Burninate and Anubhav C, as cited by Jach, was not spam, was mildly interesting, and certainly should not have warranted kicks for either of them. Anubhav_C insulting Peacebringer was even less deserving of any operator activity, especially because the entire point of having an anonymous mod-bot is presumably to prevent the interference of ego and reputation! I believe that will be the consensus position. If such a consensus is established, I suggest that the operator who kicked them back down, admit an error, and stop this whole set of nonsense before it gets any worse. If the opposite consensus is reached, I suggest Anubhav back down, and likewise stop this ridiculous affair.
How, exactly, is this discussion a "waste of time"? If it is worth having an IRC channel, it is worth taking the time to ensure that it functions smoothly.
#lesswrong on Freenode, which used to be the official unofficial LessWrong channel, has been re-designated as a private hangout reserved for, roughly, ggreer/AngryParsley, efm, realitygrill, rsaarelm, ksotala, gwern, Grognor, chelz, cwillu, Boxo, nshepperd, ivan, mstevens, and jandrog. You're still welcome to speak there, but only if whatever you're saying is interesting/important to one of them and the op.
For less constrained conversation, go to #lesswrong-alt (unregistered; recommended by #lesswrong's op), also on Freenode.
EDIT: #lesswrong's rules have been changed to "behave like decent human beings, give ops liberally to channel regulars, don't ban without warning or if most people disagree". This PSA is hereby retracted.