Slam, I appreciate your research, but you ought to pick up a copy of Brophy's Arsenal of Freedom, containing SA's Annual Reports. It might cause you to rethink some of your conspiracy theories while providing support for your technical points. Here's a couple of clues, some pretty clear; others suggesting more research is needed.
1) In FY1900: "The temperature at which barrels were heated for rolling and for annealing has, by means of the pyrometer recently purchased, been somewhat reduced..." Thus, even before the '03 was adopted, the technology was there and it was being used in the forging temp range.
2) In FY1906 another pyrometer purchase is mentioned, this one for "hardening springs and other components of the rifle." Again, the technology was there.
3) FY1919 mentions a new pyrometer system. This may be the source of assumptions that prior to the controversy there was no system present. The tale of the old hands rejecting the "new fangled" devices is just BS. This description does say the new system provided "more dependable temperature control than was formerly in use." No surprise there, as progress marches on.
This leads to an aside. Carbon content also affects the temp at which burning begins to happen. Thus, I think there's plenty of room for a combination of varying chemistry and somewhat inaccurate pyrometers allowing receiver blanks to be burnt - even with the best of intentions. I would suggest that the early pyrometer problem was not in the device's accuracy but rather a lack of understanding of the temp variability in different parts of the furnace. Also, the wartime annual reports repeatedly mention drop forgers as one of the trades in short supply.
One speculative point based on science: the core temp of a blank could not be measured back then. Burning can take place in the center and the outside can be fine - so the eyeball method could be dead on, but the chewy chocolate center could still be burnt. Further, the temp at the center can be raised by more rapid cycles of the drop hammer (from friction). Again, an opportunity for inexperienced or hurried drop forgers to burn steel on the inside.
4) One last one from FY1924: they were etching their massive pile of left over barrel blanks to check for burning - which sounds like the modern way to check for burnt steel (but I can't be sure they had a complete understanding). It says they found 2-3% of barrel blanks in inventory were burnt. OOPS! As you'll see below, this is AFTER they started checking every lot for chemistry, so the burnt barrels came from overheating during forging.
5) One more, one last thing: FY1918 report says in describing their brand new metallurgical lab (which, of course, was part of the post-Feb 1918 fixes), "Chemical analyses are now made for all the steel entering components or tools." DOUBLE OOPS!! I guess this means they had no such procedure previously and just accepted suppliers' attestations.
I don't understand the possible interplay between overhardening from burnt steel and overhardening from improper heat treatment. The SA reports describe efforts in the '20s to rehabilitate pre-1918 receivers by using the double heat treatment methods. It is now known that the physical properties of near burnt steel (which also suffers from brittleness) can be improved with careful heat treating (heat treating is done 500 deg cooler than forging). Maybe the spotty improvement they saw was of the near burnt receivers. Too bad they didn't save their failures for examination using today's knowledge.