Heya Reuben, here's my feedback on the paper as a layperson.
  
First, digging a bit deeper into the consequences of securities regulations being imposed upon the Bitcoin economy would be relevant.  It would also be helpful if you could give the layperson (the BTC "businessman") a starting point for self-education on what you feel is relevant case law.

Now, I just have questions:

Is exchanging basic goods or services for a "security" or "investment contract" a foreign idea to the local grocery store or web service provider?  How often does someone go into a store and get a cup of coffee in return for giving a "security?" (As opposed to a unit legally defined as a "currency.")  

Perhaps I'm just overlooking an obvious (everyday) security-for-goods analogy that exists on a micro-level in the US economy.  For example, as far as I know, buying something on a credit card could be analogous to buying something with a BTC-security--(maybe credit is considered a security or investment contract).

If the US economy is structured around laws that make it easy to get 'x' with USD, what funky repercussions would come out of getting 'x' with BTC?  Would I collect sales tax in the same manner?  Would the big differences come out in the wash on tax day--or--would doing business in accordance with the law be so dragged down by securities regulations that it would prohibit the purchase of a stick of gum with BTC in the first place?  

My point is that as a very simple-minded person, when I hear the words "securities law" -- I immediately think of the SEC -- and I don't typically think of the SEC as an institution worrying about the kinds of everyday transactions that Bitcoin might ultimately end up facilitating.

Sorry if you were expecting an analysis of your legal opinion--that effort fell flat on its face.  But addressing the above points might be useful to the Bitcoin community.