I figured there might be something like that in there.

My guess, then, is if you don't remove the cheatcode then it won't pass smog because they'll see your computer's version number as one of the bad ones, and reject it outright. And since VW intends to pay for the cheatcode removal process (ie it's a recall, not something you have to pay for), then you won't be able to use the "I paid X dollars" excuse, so you're not eligible for the exception. From that reasoning, I think that most VW owners have to either take advantage of the buyback or take it in for the recall repair.