Your Apple engineers smuggling code example seems a little out of left field.

I haven't been following this super closely but as the recall the FBI is essentially asking Apple to provided them with a backdoored OS that lets them get around the passcode attempt limits. Apple is concerned that this both sets a precedent while also providing the FBI with a way to get around any passcode on any iOS device they possess. Cook has stated repeatedly that there is no way to guarantee that a backdoored OS would only be used for this one instance.

You say you're in favor of the FBIs request as long as the firmware isn't handed to them - but isn't that exactly what they're asking?