You are correct.
Legally, the store is fine. It is the "assembly" of the 11+ round ("non sporting") magazine into a non-922r compliant rifle that is against the law.
It's no different than you visiting your local gun store, and buying a Saiga and a milsurp Kalashnikov magazine. Until it's inserted into the rifle, no law has been broken.
Snake belly sellers on GunJoker do this, too.