I agree fully with the above comments.
(b)(2) The CFI should, except in the case of ATOs providing flight test training, have completed 1 000 hours of flight time as pilot-in-command (PIC). At least 500 of those hours should be on flying instructional duties related to the flying courses provided, of which 200 hours may be instrument ground time
Clearly they need 1000 hours flight time. I would therefore interpret the 500 hours as time spent as a flight instructor giving airborne instruction with one exeption that 200 hours of that may be ground instruction in a Synthetic Training Device. I have never really worked out how an instructor logs Instrument Ground Time as it really counts for little and is probably conducted at a consol.
To be relevant, instruction would need to be in the same category of aircraft, eg. aeroplane or helicopter and other issues would be the type of trainig, ab-initio versus post graduate. The regulator wants to know that the CFI has sufficient knowledge, through experience of the type of training he is required to supervise.