I don’t know the difference between diploma and degree, though is the language school a school that taiwanese teachers need some licence to teach? If not, nobody will be in trouble due to the fact that you teach there.
With your ARC, you have a work right, and don’t need any kind of work permit. You can work as taiwanese work.
Foreigners need a degree and right passport with a clean record to get a work permit to teach at buxiban. Taiwanese and you need just a clean record to teach there.
You never answered what the hell is the diff between a degree and diploma? Or rather, how do you attain a diploma without getting a degree? Is your diploma blank except for “good effort” scrawled in crayon across it?
It’s not the ARC what enables you to work as an English teacher. It’s the work permit. The OP has an open work permit, so his company doesn’t need to get him a work permit based on the requirements that the OP is worried about. However, there might be jobs that have restrictions, and an open work permit doesn’t deal with those restrictions. Probably a language center doesn’t have to meet any special requirement.
Often a 2-year degree (junior college) is referred to as a diploma. If the OP didn’t have open work rights through his spouse then he would need a TEFL certificate in addition to his diploma to meet the work permit requirements for a buxiban teacher.
I think you are wrong. Foreign spouses of Taiwanese have a work right, when they have ARCs. They can work as taiwanese work, without any kinds of work permits.