I appreciate your confirmations, that's why I think there is a bug.

ot_shipping is set to false, since we don't offer free shipping on orders over a given value. It is also set to national.

Order free shipping weight status is set to false (0=no). If we use this and set the product to zero weight, then we would not be able to calculate freight based upon weight for all other destinations.

On the surface this seems like it should be simple. Have one item able to be free shipping in the 48 states, else charge normal rates for all other locations.

I can say it real easy -- ;-)

Ken