Link:
http://fullautofun.homestead.com/page36.html
scroll down to DEWAT
Was this an ATF form 5 papered DEWAT from 1968 or prior, or just an "improperly" demilled gun with no papers at all?
If it's on a Form 5, and was registered as a DEWAT MG prior to the 68 amnesty, then it's possible that it can be put on a tax paid Form 1 and reactivated as an MG, since it was already an MG prior to 1986.
I'm guessing it's the latter though from what ATF says.