A re-crown on a 16 inch barrel might technically be considered shortening it but I would imagine there would be tolerances so, a recrown which changed the length by .050 would be OK while reducing the length by 1/2' would not. Generally speaking, the short barrels are only legal if they are as they were produced by the manufacturer. I don't think one could even, legally, replace a ruined 16 inch factory barrel with a 17 inch barrel regardless of the original configuration of the rifle. The gunsmith could reline the original barrel but any replacement would have to meet the 18 inch minimum.
I do recall one case where a fellow came in with what was claimed to be an original Model 94 Trapper model with a twelve inch barrel. Now I could tell at a glance that it was not a factory produced rifle but had been cut down. The firearms officer was convinced, having been shown an old Winchester catalogue, that it was original and had given the owner paper to cover it.
Back to the recrown. Most people would be likely to observe the "don't ask, don't tell" rule but a cautious gunsmith might want to think it over and maybe even check with an RCMP officer who knows. Assuming he could find one. Regards, Bill.