Full auto with a match stick. Waves of surplus coming to the market. Separatist wars. These are all crocks of ####, to a greater or lesser degree, at least as far as explaining the law that passed in the 1990s. Some or all of these points probably were factors in having the FN singled out to be restricted back around 1980, but that was old news by the time C-68 came along.
At that time, the FN FAL was not singled out to be prohibited, in any way. The only design that was singled out was the AR-15. With that sole exception, C-68 made every centrefire, semi-automatic rifle with a pistol grip prohibited. Unless you know-it-alls think that the HK-91 could be made full auto with a match stick? Or that waves of surplus FAMAS rifles were on their way? Or that northern separatist guerillas were thinking of arming themselves with Thompson M1927A1s? The original poster seems to understand that, I don't know why the respondents do not. The vast majority of Canadian, British, Australian and Indian FN rifles in Canada were manufactured as semi-autos, why couldn't they be saved?
I think the outcome is an indicator to how very close we came to having the AR prohibited as well. It was everything they could do to save that one rifle. Of course, by 1994 the FNs were mostly already gone, with even most militia units using the C7. I don't think the DCRA had much legitimate claim to label the FAL a current service rifle, certainly not enough to fight against the wave hysteria that had every media outlet in the country at the time editorializing about the evils of any firearm that wasn't clearly a duck or deer gun.