"Yet a friend of mine recently met a CAA bod at a party that told him that on a standard JAR PPL, if you fly an N-Reg aircraft, you could fly it outside UK airspace (e.g. go to France) under a reciprocal agreement of some sort, without any additional FAA paperwork."
Clearly the CAA bod is not familiar with FARs but then you wouldn't really expect him to be.
As far as I am aware you cannot legaly hire a N reg aircraft in the UK. Federal rules again.