Thank you EXreaction. Your link to the area 51 page was brilliant. As I understand now, this has been a thorn of contention for years. "Automod is buggy, needs re-writing and should (or probably never will) be shipped with phpBB" and has been for a long time begs the question why did I just spend hours trying to get automod to load on my site?
There are 3 ways of applying code changes:
1. Via patch files. See http://en.wikipedia.org/wiki/Patch_(Unix)
2. Via manual instructions. This is what gets posted on the forums here most of the time.
3. Via automod, which is a program that essentially applies manual instructions.
If you do not want to use automod, you can apply changes manually yourself. I wish I could say you could apply them via patch files but the overwhelming majority of modification authors are not able to produce the patch files.
There seems to be a disconnect between core developers like Oleg and those who's responsibility it is to design the website and promote phpBB. For goodness sakes if it's broke don't have it anywhere on your promotional website. It's disappointing but I am glad I brought this up because I have promoted automod to several friends.
Automod is not ideal. We are trying to solve the real problem (extension and modification of standard phpbb functionality) better via extensions in 3.1. Until that is done, you just have to pick one of the available tools.