Hi CGB,
The document referred to is here:
http://www.gpo.gov/fdsys/pkg/FR-2007...df/E7-8186.pdf
See the "Proposed Special Conditions" on page 2.
Where Boeing/FAA screwed up is explanied in a few recent releases. The following artical by Flightglobal explains it quite well.
NTSB hearing on 787 batteries reveals Boeing shift on testing
Basically the LI battery
installation was supposed to preclude any explosion, release of harmful gases etc but the testing performed did not represent real failure modes and hence the battery installation system was not designed for real failures. Note: The "battery installation" includes the containment structure.
Disclaimer. I am not an expert in the 787 battery system. I am only going by public documents and official releases. Im happy to be corrected by further documents but armchair experts with generalised criticisms will be ignored.