Still seems like overstepping, still seems open to abuse, and still shouldn't be a Federal issue (though, under the currently-prevailing Commerce Clause jurisprudence, the Courts certainly wouldn't stop it from being one). But, I'm not sure this will practically be as much of a disaster as some think it might be.
“Ignorance of the law is no defense” is what they will claim despite what it says in their little “booklet”.