Andy: Here's the way I think about it.
1) In line, routed mode. That's the scenario you just described. If your servers point to the BigIP as a GW then it's routing the traffic, hence the term.
2) One-armed: the virtual servers and the pool members are on the same VLAN. In this deployment you need SNAT to force the source to look like BigIP and keep the flows symmetric.
Note: you can have combinations of one-armed and routed mode on the same box, across many vlans. So it helps to ask two questions:
1) Does the host route via BigIP? If yes, you're in-line, routed mode.
2) Does the host live on the same VLAN as the Virtual Servers? If yes, you're one-armed.
To me terms like two-armed etc. are more confusing than they are worth because it's common to have several or many VLANS involved in a BigIP deployment. So it helps me to think in terms of service flow and ask questions like above to help figure out what those flows will do in a particular scenario.
Hope this helps.
--Matt