Exactly. I don't see any "intent to defraud" here at all. This is making something out of nothing. The kids might have gotten a big surprise if they tried to sell the copy as the original, though - the old man might have had a wicked sense of humor. I imagine he did it to prove to himself how good a painter he was, able to pull it off for so long.
It is common to store the original and display a copy. This is done also with costume jewelry.