I had a similar situation living in Hawaii. They gave me considerable grief over my 1969 911E. Since the VIN is fairly short, they wanted me to have an inspection in Honolulu. I asked why and was informed that they needed to look for the 'hidden VIN'. I asked what that is and was told it was something that was started in the 80's. Then we had a conversation about my car being a 1969 and it wouldn't have the hidden vin, now would it?. ( I used to cross examine the dodo out of witnesses in court so this was fun)
The lady finally relented went outside and looked at the VIN, which magically matched the Title that was in my grubby hands. Problem solved, registration issued.
Back to your issue. I posted in a thread about the show
Speed is the new Black where they took in a customer truck, bought a new cab, frame, bed, engine, suspension and so on. My question is when does it become a different vehicle than what they started with? Could that be what CA is doing here, saying that if you change the parts so that you are just slapping a vin plate on parts that never belonged to the vehicle then its not the actual VIN of that vehicle?
No idea how to fix it though. One recommendation is to look at this article about seized Land Rover Defenders. An attorney got involved (whom I recall is a Defender owner) and ultimately got the vehicles released. The government's position was that the vehicles were not over 25 years and therefore not import(able) without conversion/EPA. The counter was that the government had no proof of their assertion.
https://jalopnik.com/all-the-seized-land-rover-defenders-will-be-returned-to-1708474732
This will likely require legal action, which brings me back to my sum of the parts issue above. BUT FFS don't give in. If the inspector is 'unsure' then I'm curious how that can be a basis for seizure. Seems that he should have more than a suspicion in order for the seizure to prevail. You need to find out which party bears the burden of proof on the VIN plate issue. If it falls on the state then I seriously doubt that the 'unsure' nature of the inspector's determination will carry the day, he could have just had gas. IF the burden falls on the party attempting registration then cousin needs to get his ducks in a row and figure out where to go to get an ultimate determination and what sort of proof is necessary.
I also remember this being an issue on
Chasing Classic Cars when there were old Jeeps involved with some Olympic skier. Wayne Corini was very concerned over the vin tag and rivets, which were new.
These are just my thoughts and not intended as legal advice. I am not licensed in CA.