I'm glad to see that two guys with differing opinions can work it our in a civil manner....that's rare on this board. My .02 on this subject (because I just went through it with my last purchase):
The first local dealer I looked at had the Bushie M4A3, 16" HBAR that I wanted. I said I'll take it. He gives me regulated paperwork. I said "NO, this isn't regulated". Well, according to him anything other than a "COLT" HBAR is regulated. By the letter of the law, he might be right. BUt, I didn't want it regulated when I knew it could be sold otherwise. I went elsewhere, 50 miles away and bought it on the spot, non-regulated. AS you guys have correctly stated, it's up to the dealer. The dealer I used was "The Armory" in Annapolis. The owner, Hal, says he's in tight with the ATF and the State, and neither has a problem with Bushie, Armalite, or other clones....as long as they're 16" HBAR's.
Buyer beware, it's dealers choice.