Kinda sad to see a former FFL licensee claiming anything about firearms "registration." The 4473 is NOT a registration document, only a record of transfer, and in most states, there is no registration whatsoever, so a lot of the above is misguided.

What you're really facing is a shop who 1) doesn't understand the forms of legal identification he's required to accept, and 2) doesn't understand the laws around record keeping. I can appreciate simple mistakes - aka being unaware it's illegal to copy military ID's, heck, I've made the same mistake in the past when making a firearms sale. Once I became aware, I rectified my records, live and learn. But the fact he's not accepting legal forms of identification, and breaking federal law, well... He does have some learning to do...