IO540
Loopholes are legal. There is tax avoidance and tax evasion - the former uses legal mechanisms to reduce liability and the latter is just illegal.
One could argue that private pilots are exploiting a loophole to gain FAA IRs and that government action to address this is no different to closing down various tax schemes, in that the government wishes people to comply with its regulation. The commercial use of N and other reg for UK based aircraft is a matter that I don't understand.
It must be galling for owners of N reg aircraft in the UK, but I doubt that the government would be obliged to pay compensation, just in the same way that they changed the tax laws affecting computer contractors and paid no compensation to them either - perhaps Flying Lawyer or a colleague may have an informed view, since I'm not a lawyer.