Brian, thanks for your message, I appreciate your concern. Let's forget about the whole thing.
As for the regs, I have 4 TX50's, 3 older ones and one newer one. I have the service manuals, and the service kits, and all 3 older ones show the o-ring as in Scubaroo's pic. Note that he mentions that he never even took the reg apart or had it serviced! So it came like that from the factory.
The newer model has a slightly different mold, and you can actually see where the body has a little bit more of a lip to extend over the o-ring.
The assembly of all these regs is pretty simple. There really aren't any parts that could be missing. Once the tube is assembled with the lever, the shuttle, the HP crown and the adjustment knob, there isn't really anything else. It slips in the body of the reg, and the not goes on the other side.
The tube is far enough in, because it
a) can't go any further and
b) everything lines up and
c) is in the exact same position on my newer tx50.
The real crack up is that swapping parts with the newer reg really proves that it's the body of the reg that is different. Putting a tube from the older style in to the newer body shows no o-ring, and putting the newer tube (looks exactly the same) into the older reg does show the o-ring.
As for breathing half water...well, I hope not. The reg is tight, meaning that if you cover the inlet you can not suck any air in.
I will continue to investigate the problem, but I'm pretty much convinced that this is simply a poor design on the part of Apeks. I'll take a look a little later today (if I have time) and see if I can take some photos and give a little more detail on this.