The gsync module totally replaces the monitors controller board, the gsync module supports nongsync, ulmb, 3d as well as gsync, it does not support freesync, it probably could as it is an FPGA, but nvidia would be suicidal to do it
The "bug" is because you are at the limit of what the monitor panel can support, the image is starting bleed to white because it is being held for too long, the only way to "fix" it is to reduce the range that gsync/freesync works at, but if anything AMD have been pushing the idea that freesync will support a wider range of refreshes
Wasn't sure it totally replaced it or not but stand corrected.
I still think it's a crazy market to be in where you are tied to one gpu manufacturer or another based on your monitor choice should you want to use this tech and most will.
Pretty sure it wouldn't take much of an update for the gsync module to be bios flashed.
Someone might be able to hack it if NVidia decide not to support adaptive display refresh.
If nothing else it'll drop the mark up price to £30 or so as you suggested and that's not a bad thing.