The latter. Moro showed that you can construct simple language rules, in particular linear rules, like the third word of every sentence modifies the noun, that humans have a hard time learning (specifically they use different parts of their brain in MRI scans and take longer to process than control languages) and are different from conventional human language structure (which hierarchical structure dependent, i.e. roughly that words are interpreted according to their position in a parse tree not their linear order).

That's what "impossible language" means in this context, not something like computationally impossible or random.