I don't think it quite works that way with the FAA rules. If it did, anyone living and/or operating their UAV 400 feet or more above sea level would be in violation. Hello Las Vegas, Phoenix, Denver, Boise, etc. I believe that AGL is the intended reference.
That's pretty much what he said (re: AGL being the reference, but WHICH ground). You may want to re-read his original message as he makes a VERY good point.
What if you are on a bluff overlooking the ocean that's 100ft up from the beach? You take off straight up to 400ft AGL then then move it over the beach below or the ocean? If you stayed over the bluff you would be 400ft AGL, but now that you are over the beach below you cross from 400ft AGL to 500ft AGL (the ground changed, not the quad BTW), and are now out of compliance with the FAA guideline on how high to fly (which is not a rule or a regulation, FWIW).
The DJI Naza will let you do this because it assumes the the take off point is 0 AGL for the entire flight, which in this case is 100ft higher than the beach you are flying over now.
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