Understood, and note the following from the instructions for Part II:
If you had a casualty or theft gain from certain trade, business, or income-producing property held more than 1 year, you may have to recapture part or all of the gain as ordinary income. See the instructions for Form 4797, Part III, for more information on the types of property subject to recapture. If recapture applies, complete Form 4797, Part III, and this line, instead of Form 4684, line 34.
Since you are not filing Form 4797 for this loss (because you have no recapture), I am starting to believe that it is appropriate to enter the loss in the same manner as does TurboTax (just a thought).
