Catalan .. re: "Blue's proper course is TACK, so the definition of Mark-Room Room is off."

I think this might be a key to where you are going astray in your thinking.  Both boats are on the same tack .. therefore there is no 18.1(a) condition which turns off 18 based upon a proper course to tack. 

Several have provided different and effective ways to "look at it".  The correct answer is that Red is inside .. so choose the one above that makes most sense to you. 

I usually progress the boats in my mind without allowing their wake-lines to cross until they are alongside the mark.  This allows you to handle situations as illustrated in Case 12 as well. 

John A makes a nice point about the "hard luff" by Red.   Red can do that probably up until she might reasonably be able to coasts to the mark and be exonerated if Red contacts Blue.  However .. if they are 1-1/2 BL's past the mark and Red does this, she is arguably no longer sailing within the markroom she is entitled to, and this would not be exonerated for breaking 16.1 if context occurred. 

Also .. as we've shown in numerous past threads .. assuming that both these boats tack 2 times inside the zone, neither boat will be entitled to mark-room after they both tack from port to starboard inside the zone (based on the application of 18.4).  

Robert "My review of RRS 86.1(a) indicates no issues with this change."

An argument against that assertion might be that 86.1(a) forbids changes to rules of an appendix that changes Part 2 and Def's and that doing what you suggest .. in effect ... changes those Appx-rules by inserting a "however-clause" exception and then inserts the standard language.  

What I am saying is that it is more complicated than simply having a gravitational force component parallel to the local surface of the water.  Surfing, as a general phenomena, is defined and understood.  Where it isn't defined is in the RRS.  Unfortunately, this forum is not the place for the very long and very deep dive explaining the physics of surging, surfing, and planing.  But to me, the take away is that we need to understand the difference between surging, planing, and surfing and when each of these is possible to be able to properly interpret and apply RRS 42.

Wow Paul ... that must have been a lot of work (and moving forward as the working out the kinks phase begins). 

Congratulations!

Ang

Thanks Ben ... yea .. you asked how the reasoning would go and I obliged :-)