I heard the "relaxed position" language from the GW over the radio during the Sealy tourney last year, and that was the first time I'd heard it before. I've never heard the interpretation for measuring a fish to mean with the mouth open at all, but the way it was explained over the radio was that the relaxed position means not pushing the fish up tight against the lip on the measuring board. I'm all for conservation and obeying the law to the best of your ability, but there are some interesting tactics for enforcing the slot around Fork.
It's always a tough call when they get within that 1/8" range. I had a fish during the Sealy tourney a few years ago that was really close, and I take a conservative approach when measuring. That fish ended up on six different measuring boards (three in my boat, one borrowed from another angler, courtesy board affixed down by the boat slips at LFM and another courtesy board was available closer to the weigh-in) before I was comfortable taking it in. It was between 1/16" and 1/8" under the slot.
If you get a citation in a Sealy tournament, you're automatically DQ'd. I can't remember if it's from that point back or for that day, but I know you're allowed to fish the other days.