I would very much like to see this in writing. Could you please provide some written evidence for this position?
Publication 101 in Illinois is quite definitive and clear and states:
"What if I have income from obligations of the United States Government?
If you have income from stocks and obligations of the United States Government that is included in your Illinois base income, you may subtract the total amount of income and interest on the obligations from your Illinois base income."
Notice the statement says "income and interest." Publication 101 does not explicit state anything about "accrued market discount income" of course; otherwise there would be no question.
By the way, I finally did find a chain that does a reasonably good job of exploring the various aspects of this question.
https://ttlc.intuit.com/community/state-taxes/discussion/accrued-market-discount-from-treasury-bills...
