AIUI, this was an NTSB ruling countermanding a ruling previously made by an NTSB official (NTSB administrative law judge, Patrick Geraghty, in an appeal by Raphael Pirker against $10,000 fine by FAA).
NTSB conceded that when the Federal Aviation Act creating FAA was passed in 1958, “so-called drones were largely the currency of science fiction.” However, NTSB said, “Congress demonstrated prescience … in the early definition of ‘aircraft’; it expressly defined the term as any airborne contrivance ‘now known or hereafter invented, used, or designed for navigation of or flight in the air’.”
NTSB said there is no “distinction” in the legislative language between manned and unmanned aircraft. “In summary, the plain language of the statutory and regulatory definitions is clear: an ‘aircraft’ is any device used for flight in the air,” NTSB stated, adding, “Therefore we find the law judge erred in presuming the regulations categorically do not apply to model aircraft.
So the NTSB do consider paper airplanes and helium party balloons as subject to regulation. In practice, I guess they will be concerned with anything that could cause injury or damage to property, which is certainly true even for model aircraft (Roman Pirozek killed by "toy" helicopter).
The wording of the 1958 Act seems as clear as the Second Amendment, and we know how controversial that turned out to be. I can see this going all the way to the Supreme Court.