I had asked FMF a long time ago if they would sell me a pipe and they told me they didn't make them. So that would lead me to believe that Service Honda is buying FMF Honda pipes and modifying them. If that is the case, that would explain the patent issue because Service Honda most certainly does represent them as FMF units. I know this because I bought one and it and the silencer came in and with FMF packaging. It also came with all the "Honda" dents that were not necessary for the KX500AF not to mention the ball peen hammer that was used to make clearance for the cylinders water pipe. I doubt that FMF would do that and them have it replanted.
I bought a spare pipe for my 500AF last year. I'm pretty sure the spare pipe had a tag on it that said KX500AF and if I remember right it was an FMF tag. The pipe on the bike has the weld that you're talking about for the water pipe clearance but the spare pipe I bought does not have that modification. The welded pipe area for the pipe that came on the bike has not been replated and definately looks like an SH modification. It may be that FMF only puts the Kawasaki header on the CR500 pipe if it is different and SH does the rest. Patent thing still doesn't make any sense to me though as FMF makes pipes for everything and anybody. I'm at work now but I'll check the spare pipe tag to verify what it says when I get back home. If it is an FMF tag maybe it has an FMF part number too.
The following is from the options section at SH for the KX500AF:
Exhaust
Carbon Fiber pipe guard $ 149.95
FMF "Q" spark arrestor (instead of regular sound silencer) $ 55.00
Replacement FMF pipe $ 229.00
Replacement FMF silencer $ 119.00
Replacement FMF spark arrestor $ 159.00
FMF ?Q? series spark arrestor $ 159.00