Either Tesla: (1) Call it a 'driver assist system' and carry that definition beyond all reasonable bounds. I've read the regulation, I don't think that defense would stand up in court. (2) Does physical testing somewhere other than California. The testing regulation is fairly onerous, and I could see them saying 'nah' we'll do this in Arizona, Nevada, etc.

You're right they don't report disengagements, but they still maintain a autonomous test vehicle permit in the state, according to the DMV website. Very strange indeed. I think (2) is probably right.