Sorry the 10 chips theory is a little silly but i mean something along those lines... here's a picture of the inside of the 'King 3DS' which seemed to be beaten to the punch in it's announcement of the exact same product so make your own conclusions about the internals.
I don't know anything about hardware as i said but isn't it possible to blow a fuse to prevent further flashing of some kind of writeable chip? And the 3DS requires it to be read only, prehaps it actually attempts to check this, meaning a read-only chip would be the only way to play a game 1:1.
The Ace3DS is kinda relevant because it is technically a bootleg of a game, they didn't buy up copies of the game and use them in their cart right? So they were playing a game in 3DS mode 1:1 just a single one. With a hardware switch then all that's needed is a way to make the user able to pick their own games - which was probably the problem they had for ages since Crown3DS and whoever else was working on this.