A good possibility you are correct, the line of debate he is using rings a bell as to what I have heard before and bring in a third party that for some reason can not talk for himself.
My first conversation with Howard on this and other VA Cavalry Battalion flags with similar histories, he was at the Buffalo Bill Museum in Cody. About six months after that, I ran into the 34th bunch at a reenactment in VA.
Agreed that the 2nd bunting patterned ANV battle flag, with a company unit designation is something Howard would not have agreed with for a flag of the 34th. If they had a flag while serving in Western Virginia & Eastern Tennessee, it is highly likely that they carried a version of the State flag, similar to sister regiments serving in that area. After their involvement at Gettysburg, it posable they received a 3rd bunting issue and carried it back to Eastern Tennessee and Western Virginia, i.e. WD#171