Yup, that's perfectly legal. Well apart from the network monitoring bit. That's illegal, according to a SA citizen being protected by the specific laws, unless a court order deems otherwise.
The 256-512 chilli service technically allows a user with a 512 line, to transfer about 6.3GB a day, assuming 51KBps down and 26KBps upstream.
That would be a legal amount to transfer. Therefore proclaiming 5GB to be "abuse" is contradictory to their statements, as well as illegal.
At the expense of the users that are managing to pull speeds that the service lets them? If DC doesn't want a user to pull 400KBps, they should limit that speed to what they said they would. They have no legal right to do this if they are not able to manage the service properly. Dave mentioned that it has been difficult due to Telkom's ESRs..... well then that is a problem they will have to sort out.