...in what way whatsoever is this "They dont allow private repos"?
The size limit is........a size limit, something every host should have; there's one for public codeberg repos too.
And while there are restrictions on what private repos are allowed, there are also restrictions on what public repos are allowed too, and it's extremely clear that neither requirement is equivalent to "they don't allow [public / private] repos".
My reading of that section is that, besides the size limit, the rules on private repos are, to an extent, less strict than of public repos; anyone who falls under your second quoted sentence couldn't have any public repos either, by the nature of public repos needing to be FOSS.