Wii Update 3.4 does in fact kill homebrew, but the people who invinted the Twilight Hack (Team Twiizers) have released another installer for the 3.4 version, so all you have to do is reinstalled it.
According to them "they fixed bugs by creating new ones" which aloud them to make another version.
I had 3.2 when I had my homebrew, I never did any updates. When I heard about the new TOS I uninstalled homebrew. I'm tired of this no more updating to have homebrew crap. The only thing I used it for was to use cheats. I can do without them, real players don't cheat.
I'm glad Nintendo is slowly getting rid of Modified Files. Soon there will be no Homebrew, soon Nintendo will force you to update to 3.4+, and soon there will be no more hacking (for homebrew anyway)
The people who made the Twilight Hack have said that they were quiting. They came back when they found a fix for the 3.4 version. But Nintendo will soon get to the point were they will have to quit and get on with there lifes.