Actually it's not unique. Padavan has been developing a firmware originally based on Asus code for the RT-N56U and RT-N65 for years now. The russian community also has a custom firmware for the WL500G and various other models. And when you look at Netgear, Linksys, DLink, they also have DD-WRT and Tomato.
What's different is that Asus has a very open stance toward custom firmwares. They officially advertise the fact that some of their routers are DD-WRT compatible. Also, Asuswrt was originally based on Tomato, which means that they are keeping the whole code (minus proprietary bits, of course) open sourced. The fact they use the same codebase for all their recent routers also makes it easier to build a custom firmware that will run on multiple models without the need to develop a completely separate FW for each model.
Another thing that might be different is probably that I am more involved and active with the community.
All open source, based on Asus's own open source code. I publish my work on Github, and I tend to push code as I work on it (rather than just when I have a new release out), which means anyone can also jump in and contribute.
To the limit of my understanding this is perfectly legal. I know at least that Asus are very much aware of this project, and we are regularly in touch, so if there were any legal implication, I would have been told about it by now. I do zero reverse engineering and zero patching, all my changes are made to the open source part. To be 110% safe I even refuse to allow users to get around regional regulations, so I don't officially support changing one's region.
I wouldn't call it official however, as in they won't publicly tell their customers to go run my firmware. "Tolerated" would imply they weren't happy about it, which is definitely not the case. I'm tempted to say "supported", not in the sense that they will provide support to customers running it, but more along the line that they have provided me with development routers, up-to-date source code when needed, etc...
It's a win-win situation for everyone involved. Some companies see open source developers as unfair competition, since we provide stuff for free. Asus saw it as an opportunity, and have embraced it perhaps more strongly than their competitors have. It allowed them to save development time by adopting Tomato as a starting base. It also allows them to get new features developed by the community (such as the OpenVPN support). And enthusiast customers will be more interested in buying their products because of all the firmware alternatives open to them.
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