I agree this is a bad AD TCM/Lycoming doing a part sales protection act.
But why would a sane IA sign off an annual because of a AD not complied with?
The A&P customers I have I give them a chance to comply with the AD and sign them off as Airworthy.
For my Non A&P owners they have the choice of me doing the AD, or them working under my supervision to get it done.
The cruel and possibly illegal part is the AD might drive ECI out of business..