Your reasoning is sound regarding a student loan repayment benefit in some situations by filing MFS. It's ridiculous that the federal IBR/ICR rules drive you to this extreme solution, but my wife and I save hundreds monthly using this same ploy.
Ironically though, one of the things you lose filing MFS is the ability to deduct student interest payments. Could it get any more Catch-22 than that?
I also agree with macuser_22 that you need to talk to someone with California Franchise Tax Board who "knows what they are talking about." But it's probably not a good idea to use that exact terminology when calling them back. Haha.
