Ah, you never said you wanted to keep the regular edits, just said that you wanted to hide the edited by. I vaguely remember something of that sort, I'll check it out and see what I can find.
"Show edited by note on edited messages?"
In the Usergroup Manager, a setting for that usergroup, can make it so that when moderators edit a post it will not be shown. However, moderators who edit their own posts still will not have this show up, so another possible solution.
I haven't gone through my tables and stuff well enough to check exactly, but I think this may be the source, in editpost.php
Code:
/*insert query*/
$db->query_write("
REPLACE INTO " . TABLE_PREFIX . "editlog (postid, userid, username, dateline, reason)
VALUES ($postinfo[postid], " . $vbulletin->userinfo['userid'] . ", '" . $db->escape_string($vbulletin->userinfo['username']) . "', " . TIMENOW . ", '" . $db->escape_string($edit['reason']) . "')
");
This is where it puts it into the editlog. If you do a check to see if it is a mod and they do not own the post, then have it skip that. Otherwise let it go ahead and change the log to have the post be edited.