If it is only a bad localised corrosion at one spot, composite wrap should be able to protect the thinned area as long as you have enough 'anchoring' space d/stream and u/stream of the spot. Proper surface prep shall be done on this area, as it will provide sealing and isolating the localised...
Well, with proper justification, engineers can decide on any construction code they like, and they may also take exception on certain requirement and rules. I guess that's one way to be creative!
Possibly the extra thickness from PV codes is desired for the CA, since the owner may expect high...
LittleInch's comment on ID probably based on the fact that the wall thickness required based on ASME VIII calculation will always be higher than pipeline code calculation (using the same MAWP/DP). The smaller ID may cause various problems; pipeline inspection for roundness using gauge plates...
