Paul, thanks for posting the actual text of the law. Nothing like having the rules book when having a discussion about what the rules are.
If I interpret 45509(a) correctly, what we understand as model aircraft, and which are defined in Section 343 "Special Rules for Model Aircraft," are entirely outside the scope of FAA regulation and oversight. There are conditions, basically that we adopt an honor system and operate within the rules of the AMA for our particular branch of the hobby and operate safely. Within what used to be called uncontrolled airspace (Class G) up to 400 feet AGL there is no regulation. Close to an airport you have to alert the tower, though how is not specified.
45501(5) defines "model aircraft" as being flown for hobby or recreational purposes, so this will require commercial quadrotor flyers (or any other commercially flown model aircraft) to register and be subject to regulations (as yet unwritten).
Section 343(a) even prohibits the FAA from adopting regulations for "model aircraft" as defined. This was in the prior version of the law, but the fact it is re-authorized is reason to hope the congress will abide by what it says.
So, from this I conclude (1) that our control line models, even scale and carrier using remote throttles, are entirely unregulated by the FAA, and (2) conventional model aircraft including all recreational RC (and yes, the cheapo Walmart quads) are also outside the purview of FAA regulation.
I think this is a pretty good result, and to the extent the AMA had a hand in achieving this, kudos to them.
And PLEASE anyone reading this or the statutes themselves, don't go off on some rant about the jackbooted thugs from the unelected unconstitutional gummint agencies ignoring these limits and stomping all over your freedoms. If you feel that way, you can go fly models in Galt's Gulch with the other libertarian escapists. These laws were passed by a solidly and deeply conservative Republican Congress and will be signed into law by a Republican president. The law is up for re-authorization in five years. If it hasn't worked to your/our liking, vote.