Yes, this understanding is correct.
Does this make a difference? Since the OP would have got 600 points, he will get an ITA and proceed. I don't think we have enough evidence to substantiate that there is a significant difference in processing times for FSWP and CEC candidates. [/b][/color]
This can be done, IMO. Since he would have got 600 points post nomination, the extra points of Canadian work experience becomes meaningless. So, he could very well remove the Canadian work experience (or retain it), it doesn't matter. He will be invited to apply under the PNP stream.
The only problem here, IMO, is the Proof of funds. CEC candidates are exempt from POF, FSW counterparts are not. So, if he gets assessed under FSW and gets a nomination from OINP, then, he will have to show POF (whilst applicants assessed under CEC can get away with the POF requirement, even when invited to apply under the PNP stream.)