Looking at the current rules:
A) is easy. For a sole proprietorship or an S-corporation your SSN is a TIN (First term) as for as the IRS is concerned. (Actually the IRS calls it EIN) Lots of good reasons to run a small company that way. Lots of reasons to get a separate EIN including keeping your SSN secure. Sole proprietorships are easy to create requiring almost no paper work. In Georgia, they require a county business license in the counties they do business in. >$200 annual fee for one with little income. A LLC requires annual registration at the state level. In GA $100 for initial and then $50 annual.
B) is easy as well. Your business just needs to be separate from a team and not make "COTs" parts primarily for a team.
C) Is a bit more problematic. Many large corporations which are my vendors would not meet the literal definition. The GDC tends to like their rules to be interpreted literally.
. But I read it as that you need to have the resources so you can handle reasonable demand. The IRS tends to divide business and hobbyist on rather or not you make a profit. Although if you make a profit on your hobby they want their cut and their are many large companies that operate at a loss.
An encoder is considered to be a custom circuit. It is not required to meet UL or other certifications. It not even required to actually work.
Anyway I think it is really neat that you were inspired to do this. Don't let the paper pushers keep you down.