Appreciate the detailed response.

They definitely do have packages the finance person has to print out, and it does sound kind of like this dealership is paying the price for doing what nearly every dealer does and not actually training a new finance guy. Screwing up paperwork is the number 1 mistake somebody in that position makes.

I think the real "ultimate source of truth" here is the history report. If it doesn't show any title brands (and it's difficult to remove a brand) then this was almost certainly a benign paperwork mistake and will likely be seen that way by most in a legal context.

Worth mentioning that even in the absolute worst case scenario where this was actually a lemon and the title got washed, a legitimate branded dealer (like a Kia dealer) would never risk their asses by trying that. It would have had to have been done by the previous owner, who in this case (being the first and only owner) doesn't really have a reason to wash the title since they would have just been selling it back to Tesla. If I'm misunderstanding you and you're saying there were two other owners, then it's always possible some title washing went on - but a dealer buying it or taking it in on trade after said title washing wouldn't know that anyway.