As far as I can tell, you're correct. The terminology for transactions you call "OK" and "Not OK" is "final" and "non-final." One wrinkle is that there was some divergent behaviour in the testnet, where non-final transactions (nLockTime in future & sequence number < UINT_MAX) were being accepted but not replaced. This was fixed just a few days ago.

In any case: there is no code in Bitcoin Core to replace transactions based on sequence number, and mainnet nodes don't accept non-final transactions into the mempool.

Oh yeah, and a non-final transaction can't be included in a block until it turns final. It makes the block invalid, which will fork anyone who accepts it off the blockchain.