That's the easy bit - it complies. They are scattering small permanent magnets around a layout. There is no legislation covering that, so its fine. No different to using fixed magnets for uncouplers.I suppose the first question is: how does this magnetic implementation comply with radio/interference legislation ?
Their loco-mounted detector appears to have a three-axis magnetic sensor in it (not dissimilar to the compass sensor in phones), which can measure the field created by the magnets (which is over the field for the layout room from other magnetic sources, plus the earth's magnetic field).
They then compute something from that field (possibly strength, orientation in three axis) and transmit it back to the base unit over the rails. The base unit knows the magnetic-field reports from each loco for each cluster of magnets, so knows position as a cluster of magnets are passed by a particular loco.
I think its then using back-EMF pulse counting from thereafter to compute position of loco between clusters of magnets (so can't work with a Dyna-drive loco which has a free-wheeling clutch, but there are not many of those around).
The rest, I agree, is unlikely to fly as currently presented.
The booster issue is not the product-killer (though its serious), its the detector piggy-back installation. That makes it impractical for most owners (those who regard plug-in decoders as their technical limit). The maker proposes to build a new DCC decoder, but I can't see how they'll replicate the sound options on ESU and Zimo decoders, so that's a "no sounds" option (or "generic chuffs and grunts"), and another large category of users no longer interested.