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This would get thrown out in court I can see them saying you can produce no more from here on out and Grandfathering the ones in circulation but not confiscating them.
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That would be the fair thing to do, but unfortunately thats not the way the law works; there is no way they could be grandfathered without Congress amending the law. And FWIW, BATFE will try to track down individual owners. They've done it in the past with improperly demiled Uzi kits, improperly imported PPSH41 kits, the SOCOM Mfg. RPD and M249 M11-9 uppers, etc.