In fact without a maintenance release the aircraft at best was a static exhibit.
No, not quite.
If the aircraft is on the register, it is deemed that the registered owner has responsibilities to ensure that the law relating to the maintenance of the aircraft is complied with.
If the aircraft is not registered then it is a non entity in the eyes of the law regarding the regulator. (An empty beer bottle as some one has said)
Were someone to fly it, then the Police would have a case that the aircraft was flown unregistered.
The tactics of the investigators is clearly dodgy to say the least but I wonder whether it should ever have got to the point it did.