this isn't that confusing, I do play auto match exclusively at the moment but only 1v1, I don't use mods, if I play automatch team games is faction mixing disabled then? I have tried hosting team games but its hard to get players, I would simply like the option to join games, even if I check the factions in a game, i can be in there waiting 20 minutes and then some guy joins and mixes factions so im back to square one and have to leave, if faction mixing was disabled I would see that the server itself doesn't want it before joining.
If you play automatch team games then you can only play axis vs allies. So in the sense that I understand this thread there is no faction mixing. It is also impossible to use mods in automatch but if you don't mean to use them there is no reason to go for hosted games.
In hosted games there are no rules like that, everything is allowed: playing with mods, teams consisting of allies and axis at the same time, stupid anime skins and so on. As long as you don't need to use any of these features don't go into that swamp.
There is one thing to add: in automatch there is a bug that very rarely, but still, allows for faction mixing. Its not seen very often but if you do see it then mind that it doesn't mean faction mixing is allowed, its the bug abuse.