The whole sentence describes a recent change.
She had problems before with drinking and worrying too much about her appearance. She's happier now because she quit drinking alcohol, and she's returned to work. She's also happier now because she is not so worried about her appearance. That means that she doesn't need to exercise so much or so often before work, and she eats more of whatever she wants. It implies that she used to be so afraid of gaining weight that she once had a birthday cake that was actually watermelon with whip cream instead of a real cake, but now she does or would just enjoy cake.
*Is not omitted?*
Not doesn't need to be there, but it is implied.
Let's simplify part of the sentence as if it's just a quote. This part:
"(I'm glad to be working again,) while not stressing myself with a strenuous workout schedule or depriving myself from (eating cake)... ."
means the same as:
"(I'm glad to be working again,) while not stressing myself with a strenuous workout schedule, and not depriving myself from (eating cake)... ."
We don't need not again after or, just as we can say
My grandmother always told me: Don't drink or smoke.
We can understand that it means Don't drink and don't smoke. So, yes, the not is omitted, but that is normal and grammatical.
We can clarify the meaning as:
I'm glad to be working again. I used to stress myself with exercising and then working 14-hour days. Now I don't. I used to deprive myself by eating watermelon instead of cake. Now I eat cake. (Now I don't deprive myself of eating cake.)
Shit means something unpleasant here. Diet shit is a noun phrase that means unpleasant things involving diets, just like office building means a building of offices.
Think of diet shit as being similar to (adjective) + (noun), but it's (noun) + (noun) instead. Sometimes nouns are used to modify other nouns, as is the case with office building.
That is a long and complex sentence. So it would be challenging for many English learners. Because the phrases are so long, it's not easy to see that the (not) idea is implied, so you may feel it needs to be. But it's a common enough kind of grammatical structure, typical of one that reports speech. So most native speakers can follow it without needing to think about it, and understand that it means *I am ... while not ... + and also not depriving myself of .... .