Users that we're considering for a moderator position are judged on their post history, general attitude on the forums and their interactions with other users (among other things). The "Trial Period" I mentioned is an internal process, and one that SeanBeansShako is currently passing through. To date no moderators have done anything that might make me believe they are unsuitable for the team during their trial phase (or later), which is why no-one has failed it yet. I personally put the perfect pass rate of the trial phase down to the high level of investigation and research that goes into potential candidates before they are even approached about the position - we don't consider people who would be unlikely to pass the trial phase.
SeanBeansShako's removal of unnecessary threads is part of routine cleaning that helps to keep the forums easy to use, and reduces clutter. Any threads that are "removed" are done so either at the request of the thread owner, or to remove inappropriate material from the forums. Even then, the threads aren't fully deleted - they go to a hidden archive from where we can re-instate them if needs be. Removing threads like this makes searching the forum for specific threads easier, and means that our forum users can more easily find what they are looking for when browsing the public boards.
As far as moderator activity goes, I've never had any problems with the activity of any of my moderators. At the minimum our job requires us to log in, check for any open reports and resolve any that are open. Any time spent online beyond that is effectively overtime - it's not essential for the general day-to-day running of the forum. None of our moderators can be online 100% of the time, and I am perfectly happy with the work they do, and their activity levels. Being a moderator isn't about being the most active forum user around - If you check my post history, the vast majority of my posts are moderation posts rather than actual forum use. Moderators generally give up the majority of their recreational use of the forums when they take the job, which means that we usually don't have the same visible activity level as normal forumites (and can't be judged by the same standards).