After reading this thread and considering it, the regulations seem fine, but lack of consistency between states seems to be a large pain-pont.
I realize California isn't just "any" state but needing to seek unique approval from up to all 50 states just to run an online school seems like a really high (and expensive) bar.
It would be nice if more states cooperated on things like this. Then you seek approval from the collective, rather than at an individual level.