Can I shortcut a loop with conditional actions?
This loop definitely includes conditional actions, because when you have 999,999 Wireflies, when activate the ability and it resolves, you make the following choice:


If the ability created a Wirefly, you stop
Otherwise, you flip again


Rule 101.2 says


  When a rule or effect allows or directs something to happen, and another effect states that it can't happen, the "can't" effect takes precedence.


Therefore, the restriction in 716.2a overrides the allowance in 716.1a.

In addition, if you assume that 716.1a effectively allows any shortcut that both players agree to, then the restrictions in 716.2a don't really make sense.