I don't think running in a browser has anything to do with whether something is a MUD or not. All of our MUDs run in a browser, for instance. The browser is just a client program that can be used to interface with a server, no different from Zmud or the crappy Windows telnet program.
What disqualifies this as a MUD in my mind is that it basically lacks any sort of simulation of a 'world'. It's got a handful of locations you teleport to that are little more than glorified IRC Chatrooms. There also seems to be (I barely tried the game out, as it is not to my taste) no real-time updates of what's going on around you.
--matt
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