Inland-
I'm a little afraid to reply as the answer might be view as "the WDFW answer" which of course would not have any credibility with you.

However I give it a stab.

Yes, you are correct in that the the wild summer steelhead population is the result naturalization of hatchery fish. Since they have been produced by naturally spawning fish most would consider them to be wild but not native steelhead. However they would cover under the WSR regulations - it is not Native Steelhead release after all.

I could not agree more that those steelhead don't belong above Sunset - it was trout water (actually a quite good fishery). However in 1958 the State (Department of Fisheries) decided to open that water (as well as the South Fork Stillaguamish above Granite Falls) to anadromous production - that is salmon. There is roughly 100 miles of coho habitat above the falls. That portion of the watershed currently supports roughly 20% of the basin's coho and chinook escapements. The folks interested in salmon recovery, the tribes, and possibly several federal agencies have no interest excluding salmon from the area (it is sused both ESA listed chinook and bull trout - naturally colonized the area). It has been estimated that that area produces about 1/4 million coho smolts. With that competition is it better to attempt to management the game fish populations (trout etc) with an anadromous fish (steelhead) or a resident fish - a tough call.

By the way there are still good numbers of trout upstream of the majority of the anadromous fish use zones as well some large trout that have dropped down into the anadromus zone.

Tight lines
S malma