Dao is self-guidance.
~ The Doctrine of the Mean ~
Ziporyn understands self-guidance in this context to mean "spontaneous nondeliberate directedness", a meaning suspiciously reminiscent of Daoism's wuwei. Since this document is a Confucian re-working in the light of the Daoist challenge, this should not surprise us. Nor, in the end, is it incompatible with Confucianism generally, or any other similar philosophy directed toward sagehood. The ultimate goal, the achieving of sagehood, is to be so completely what one intends to be as to no longer need to intend it. The sage does the 'right' thing automatically, without any need to weigh options or otherwise think about it. Thus, "Dao is self-guidance" refers to this ideal realized state. But what of how one gets there? This is where Daoism's wuwei is much more radical than anything Confucianism can assimilate.
The Confucian sage has a moral goal beyond spontaneity — benevolence — and spontaneity is not the means for attaining it. This is the "directedness" to which Ziporyn refers. His sincerity-of-purpose (cheng) is to become a paragon of virtue, and is thus value-directed. The Daoist sage, on the other hand, prefers to put his trust in spontaneity itself — come what may. In this sense, her wuwei is non-directed. Confucianism has a moral overlay where Daoism does not.
Such a distinction led Confucianism to the question of "human nature" — is it good, bad or neutral? Since Confucianism seeks the Good, the validity or depth of this "self-guidance" is determined by how much 'good' will spontaneously arise from human nature. Thus "self-guidance" might, in fact, be a battle with oneself and even require the non-spontaneous imposition of external norms (Xunzi). Wherever he falls on the continuum of the innate morality of humanity (even when he affirms the essential 'goodness' of humanity as does Mencius, who nonetheless recognizes that that goodness has been largely obliterated), in the end the Confucian must make use of a most non-spontaneous "directedness". He must work at being 'good'.
The Daoist 'works' at being spontaneous, without worrying about 'moral' outcomes. Because, like the Confucians, we are typically bound by moral considerations, this worries us. We fear that this will lead others to behavior harmful to society. Immoral monsters will pop up everywhere. But Daoism would ask us, I think, "how would it lead you to behave?" This is, after all, about the individual, me. Immediately, we think of some universal application of Daoism to society, a religious philosophy to be applied to the world, yet it is no such thing. It is and can only be a personal dao. It is not a “categorical imperative” the validity of which is determined by its universal applicability, a la Kant. So the real question we need to ask is: "Can I trust myself to follow a path of spontaneous non-directed 'self-guidance'?" My guess is that you can.
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