I was the guy with the "artillery liberator". The barrel on it is 106.7 mm long, a whopping increase of almost 5mm over the original. I haven't shot it yet, and I feel bad about having had to mess with such a historic piece. Even the firearms tech in Ottawa tried to talk me out of it.
You cannot merely remove the barrel of a prohib and then call it a restricted only frame/receiver. You must have a longer barrel installed and then you can register it as a restricted. And you are correct that the CFC considers the short barrel a prohibited device. I have seen more than a few loose barrels for sale in the junk boxes at gun shows, so I can't say how well the CFC's interpretation of a "prohibited device" is being enforced.
If the FRT entry for a particular gun is only prohib, then trying to register a "found" gun cannot be done by merely removing the barrel. Although I did own one of the artillery Lugers, I do not know enough about them to say if the FRT can distinguish the frame of an arty luger from a run of the mill prohib version.
I also think someone mentioned recently that the CFC was now not allowing certain conversions of the prohibs, although that may have been caliber changes on the .25s and .32s.