Modrons and slaads represent the most
extreme cases of the Law and Chaos spectrum, so it is surprising to
see them sharing an article together.
What was even more surprising and refreshing is that after so many Wandering Monsters columns asking if a fairly cut and dry monster was “iconically D&D enough”, Wyatt pitches some tougher questions in the poll, like if modrons are too silly and/or make sense, and in the case of the slaad even goes so far to suggest a fairly drastic change to their identity.
I have always felt that they are pretty boring and forgettable, which might explain why they seemed to slide into later editions near the end of their run as a Dragon article (which I would read then promptly shelve). 2nd Edition made note that they trade with other races, but for what? What do modrons need that they could not make or get themselves? Given all their rules and regulations, would anyone want to deal with them? I guess you can also maybe hire one to do clerical work, but I have no idea what you could possibly offer, or why any such request would even be approved.
Even if you ignored that, one of the few plot hooks that I could think to run with would be to have them try to continually expand across the multiverse in an attempt to bring order to everything, but even that would not work since there is always a set population and--according to 2nd Edition, anyway--they lack the resources to do so.
It is because of this that I am fine with giving them more personality, even for the base ones, and making rogues more commonplace. Anything to shake things up, making it so that their rigid concept of paradise is not so perfect, and in fact something that they must constantly strive to maintain. I would also change it so that they freely trade with other races (which could include hiring them), and even invite them into their cities, if only to show them the benefits of their particular brand of order.
I would also run with the idea of them gradually expanding. In uninhabited areas they simply claim, constructing foundries and stripping away necessary resources to reshape the land. For inhabited areas, they offer to improve their lives and give the inhabitants new roles and functions, kind of like Warhammer 40,000's Tau, or the Alliance from Firefly, conquering those that refuse. Since modrons have a set unit cap, you could take a darker route by having them convert other races into things like Mass Effect's husks, or the Cybermen from Doctor Who. Maybe Exalted's alchemicals?
(Note: Jot all this down for my treatment for them in A Sundered World.)
Actually, on that note, I would re-flavor their magic to operate something like the alchemicals' Protocols. It would make them more interesting, and could even pave the way for another school of wizardry.
(Note: This, too.)
As for their appearance, I actually do not mind it all that much, though I prefer 4th Edition's more machine look. Their odd shapes seem to keep with the idea that simple modrons are capable of only simple thought processes; as they become more human in shape, they become more capable of complex thought and individuality. I think the only thing I would like to see less of are the steam whistles.
My opinion of slaads is a bit more succinct. I have never used them, but am always for more aberrations, especially if they can corrupt others. One of my main problems with them is that despite being chaotic outsiders they are still nicely, consistently color-coded. Even their creator described them as his "independent exploration of Lovecraftiana", which not only makes it easier to accept their color scheme (which makes me think of the xenomorphs from Aliens), but also the existence of slaad lords (which I would compare to Lovecraft's elder gods).
As for the psionic angle, I can take it or leave it. Though I do love psionics, I think that if insanity-inducing magic is good enough for the rest of the Cthulhu mythos, that it is good enough for slaads. This could work out great for a warlock pact, though I guess if they had psionics you could end up with a kind of crazy-psion discipline, too...
Ultimately, if you want to keep slaads as creatures of chaos, I would do away with colors and just give us lots of optional powers to tack on as we see fit, in a similar manner to Planescape's hordlings.