I have no idea about how Basic AP "rules" are implemented today, but with all of the Tesla AI do they not implement some logic for an "AP confidence score" based on the available cameras and other sensors? Maybe it already does or has always worked that way?
In other words, driver looking ahead on a straight road (highway, divided highway, etc.) with clear lane markings, results in a very high AP confidence score such that if I look at the screen for a few seconds I don't get nagged and can actually keep my hands off the wheel (maybe with some maximum allowed time without wheel torque). But if I'm on a windy road or going through a section where it detects stop signs, traffic lights, lanes aren't marked, I'm looking away from the road, or otherwise distracted, then the confidence score drops, and it requires more regular input or completely disables AP for that section of the road. If I fail to input or take over in response to a prompt and it disables automatically that's a "strike". Or some egregious events like the cabin camera/seat weight sensor detects there is no-one in the driver seat immediately trigger a "take over now!" with a strike if not acknowledged right away.
I think there may actually already be some of this logic in place based on the variable frequency of nags depending on the driving conditions and speed, but to be fair I've had FSDb enabled through my 3-month trial so I won't have much experience with the behavior of Basic AP until next month.
So ultimately is the resolution to this just an adjustment to what it does today:
1. A refinement of the model that detects inattentiveness and suitable AP use conditions based on interior/exterior cameras, input sensors, and driving dynamics.
2. More effective alerting and UI to notify the driver they need to provide some type of input.
3. The strikeout system if the driver does not respond to prompts or the model detects some egregious violation (which inevitably raises the "false-strikes" conversation from FSDb).
Seems like they could satisfy the NHTSA and enable "hands-free" driving in appropriate conditions for Basic API without resulting to geo-fencing or other more restrictive solutions.