It does count for something. It clearly shows the affected director someone that does not support his NSA program very much.
The rule is in place to lock out those teams and players that play the system by running off and "hiding" in another association for a year or two (or seven) then try to come back in the lowest possible classification. It's not a perfect solution, and plenty of players that don't pay attention get "caught up" in it, but at least it addresses the sandbagging issue.
It's hilarious when I hear "They do it this way in Utrip (or ASA, or EIEIO)... you should be doing it in NSA too!" Do these same people go to Utrip and cry about how they need to do this or that because NSA does it? I doubt it.
NSA has a rule book. It's online for all to see, and if you don't know the rule, chances are you're not gonna be granted a mulligan, in NSA or anywhere else.
If you're building a team to compete on the regional or national stage, taking your local director's word ONLY, without asking questions further up, is not very smart procedure. There are a lot of competent local guys out there (and some that are not as much), but if they misunderstand or mis-interpret one little thing, it could have some serious consequences.