For many reasons, that I'd rather not go over, it looks more like a sloppy op. It looks like the background check box was not filled in, because the paperwork was set aside and forgotten, after the special order was made. When it eventually arrived, they probably overlooked it, and assumed it was done. That means he probably didn't have an organized ringbinder system, or the equivalent. I think the willful argument in fed court will focus on the warning given at the first audit, and his failure to clean up his act.
I'm sure you're right. If any of those omissions were used in crime, the BATF would be shouting it from the rooftops. And 8 or 9 transactions a year isn't indicative of black market transactions, not to mention there wouldn't be any paperwork at all. Hopefully he won't be put out of business over this.