On the quasi-legal side of production, a parts kit for converting the airsoft to live fire is technically not illegal as long as installation would require some permanent modification of the airsoft reciever housing, or possibly a receiver insert, where the steel insert is technically the "firearm parts" and the airsoft housing is simply there for cosmetics (kind of like where people hack a Ruger 10/22 into an airsoft G36 or FN P90 housing).
Another quasi legal thing for the folding ARES type design (which had its patent run out like ten years ago) is producing component parts in different workshops, sold by different retailers, and parts kits vs flats the way you see with the various MAC clone parts and parts kits. One added bonus of the ARES design is that the swing down grips can be changed out depending on the availability of different magazine formats, although two position feed magazines (like the Uzi, Sterling, or Thompson) would likely require a different bolt from a single position feed magazine (Sten, MAC, or M3 Grease Gun) but it may be possible to come up with a universal bolt design and only have the variations in geometry change out with the grip assembly.
Keltec does some folding semiautos on the same basic platform, but they sell it with different grip assemblies in order to be compatible with different types of autopistol magazines, IE, Beretta, Glock and S&W, all single position feed types, and the folding mechanism of the Keltec is not friendly to setting it up with a shorter barrel.
The European and Israeli solutions have involved standalone handgun actions with an extremely short grip option, and then the option of swapping out either longer magazines with a grip section built onto them, or a grip assembly with a longer magwell, and then a whole stock/housing assembly that mounts to the handgun frame rail system. SIG has that entire thing incorporated into their SIG P250 pistol system, where the actual "gun" is a chassis that is inside the actual handgun, and the external plastic, magazines and slide are all swappable.
