I think your explanation accuarely portrays the situation for this John Baker.
I have seen several instances where a man was listed as "Absent Without Leave" on a Regimental Return, but was in fact in hospital. Other times a man was discharged from hospital, but was retained as a "nurse" etc. and again, would appear as "Absent Without Leave" on a Regimental Return due to a "lag" in paper work. Administrative communication with regiments in the field was sometimes delayed by weeks.