People paying the membership fee are expected to be distributing apps via the app store... installing it on your own device is expected to be a step for testing the app before you upload it to the store. Apple doesn't allow for any "I just want to goof around and make some of my own apps for my own iPhone." kind of people.
Sure they do! There is no requirement after enrolling to do any App store Distribution whatsoever. Well over 100K enrolled iOS developers never submit an app to the app store.
I've got tons of "white icon" apps on my iPhone. Some are potential app store apps in development, but some are just fun things I've been "goofing around" with. I know other people who enroll just to install some open source code on their device without having to mod their OS or otherwise screw with their device security.
The $99 enrollment fee is not much different than if Apple charged an In-App purchase to unlock 1 year of run/install functionality in Xcode, instead of charging for development tools outright.
Goof around all you want, as long as you renew if you want to keep your apps running.
Or if you've finished your custom app and it doesn't use any private APIs, etc., and want it to keep running even if you don't renew, you could submit it for review (which you paid for as part of your enrollment), make the app available in only your country's store for only a few hours after setting some silly high price, then download your 1 copy using a redemption code, and remove the app from sale.