Keep at it, Eo!
Well, keep up the good work. Many of us (possible customers) are watching with keen interest.
I'm in with the rest of the guys wanting a couple of cases when you actually get the ammo stream going.
A couple of observations - first, there's little good to be had actually ARGUING with the Feds, regardless how solid your logic is and in the total absence of theirs. I'd accept that the law is what it is (stupid, but there and enforcable) so you have to find out what you CAN do that they'll be happy with - and try to get it in writing so they don't easily change their minds later.
("Hey, I have this LETTER from your chief that says this stuff is okay")
Second, I think you can really make this work if you stick with "customer satisfaction" driving your work. If you put a little website together and keep posted the "in stock" status, and actually ship when you say you will, maybe even drop a guy an email when his stuff ships, you will have plenty of business. My pet peeves are suppliers who sell stuff that's been out of stock for a month and never tell you until you call when they're a month late.
I figure this could be a problem for you 'cause you're at the mercy of your supplier. If you post stock status and do what you say you're going to do, when you say so, there's LOTS of us that would buy from you JUST for that.
GOOD LUCK to you! If you can pull this off, all the other stuff (like the other ammo ideas) may follow very well.
Lemme know if you need a partner when you get this worked out. I'm in Minnesota, so if you have a "west of the Mississippi" shipping differential since ammo's heavy, we can talk