I agree that it is a mess, but I'm not sure I agree with your point about (t).  Why do you say the definition of "financial institution" is relevant to the foreign MSB analysis? Neither the definition of "money transmitter" nor "money services business" rely on the term "financial institution".

FinCEN doesn't agree either: http://www.fincen.gov/statutes_regs/guidance/html/FIN-2012-A001.html

Ultimately, I think this extraterritorial exercise of jurisdiction is probably legally justified.  Servicing a customer in a particular jurisdiction typically subjects you to that jurisdiction's ...jurisdiction for claims arising out of that transaction.  That is, it probably satisfies constitutional "minimum contacts" and "traditional notions of fair play and substantial justice."  At least for the civil claims, I think it would survive judicial scrutiny.

What do you think?