I'm not sure this online EULA is that over-reaching relative to traditional references.

At my (Canadian) school all references needed to be accompanied by a standard waiver of liability form. Provincial privacy acts prohibit divulging any student performance info without clear authorization. Due to pushback we could usually get away with a clearly worded email authorizing someone to provide an honest reference.

I imagine they are just protecting themselves against sue-happy Americans (I didn't get into Harvard because my reference forgot to hit save, I'm suing you for crappy web design). If you read the text of the EULA, it's surprisingly benign. They are not even taking ownership of your reference.

Although the reply still is fun.