While they created a set of patches that would implement the security features that selinux provides, what was actually merged was the result of several years of open collaboration and development towards implementing those features.
There’s general agreement that the idea that the NSA proposed is good and an improvement, but there was, and still is, disagreement about the specific implementation approaches.
To avoid issues, an approach was taken to create a more generic system that selinux would then take advantage of. That’s why selinux, app armor and others can live side by without it being a constant maintenance and security nightmare. Each one lives in their little self contained auditable boxes, and the kernel just makes the “check authorization” function call and it flows into the right module by configuration.
The Linux community was pretty paranoid about the NSA in 2000, so the code definitely got a lot more scrutiny than the typical proposal.
A much easier way to introduce a backdoor would be to start a tiny company that produces some arbitrary piece of hardware which you then add kernel support for.
https://github.com/torvalds/linux/tree/master/drivers/input/keyboard - that’s just the keyboard drivers.
Now you’re adding code to the kernel and with the right driver and development ability you can plausibly make changes that have non-obvious impacts, and as a bonus if someone notices, you can just say “oops!” And not be “the god-damned NSA” who everyone expects to be up to something, and instead be 4 humble keyboard enthusiasts with an esoteric set of lighting and input opinions like are a dime a dozen on Kickstarter.
Paranoia in the sense of being concerned with the ill intent of others, not the sense of an irrational worry about about persecution. Much like how the intelligence community itself is said to have institutional paranoia.