Success!
It wasn't easy though. The inspection lady needed to verify the engine number which I wrote down after removing the sprocket cover. Luckily it was visible below but she was on her knees looking. The inspection was all about emissions, it is EPA but not CARB. Little problem.
Inside guy cannot find it in the computer. Tells me it can't be registered. WTF? I say the dealer said it was OK, I wouldn't have bought it if I couldn't reg it. He goes out and looks and says "see, it's EPA and not CARB and it's out of state so it needs 7500 miles or we can't reg it. I tell him that the dealer said the 50cc was OK, but not the 125.
We go back in. He really likes the bike too, thinks it's cool and wants one himself...
Finally he finds the proper "exemption code", if it's under 50cc it's OK. Paperwork states 49.5. Woo-hoo!
Got a plate and a reg and the title is coming by mail. In like Flint -