RedSquirrel, your logic is more than likely faulty, though intentions are good. I've seen software developers put restrictions like these in place previously, and it gets on my nerves, to no end. I can think of *very* few instances where restricting input to the root of a domain name is a good idea -- I'd love to know exactly what your goals are, as I'm having a hard time understanding that. Not your technical goals, but a high-level overview.
Here's an example of why I dislike your current approach. I manage several domains for local government agencies. In the State of Ohio, a large number of local governments use their respective delegated oh.us namespace for their website, internal management realm, etc. I've been delegated co.<entityname>.oh.us and sheriff.<entityname>.oh.us by Neustar (among others). Do you know what happens when I attempt to register one or both of those zones with some services? I've been told that I can't do so, because I'm not responsible for <entityname>.oh.us. I've also been told that I can register one or the other, but not both, because both would indicate that I'm responsible for the parent (not true).
And then we have situations where I want to open accounts for subdivisions, and can't do that because of arbitrary restrictions. I can't open a separate account for utilities.co.<entityname>.oh.us because I already have an account with the same company for co.<entityname>.oh.us, and their automated registration system checks to make sure that you're not trying to register a subdomain of an existing zone. (There is good reason that I want to do this -- legal and political separation between accounts/systems, it's not just because I felt like it.) Ok, I can live with having to contact the company and explaining the situation, because I understand that personal websites and the majority of small business websites will never encounter this situation. My blood boils when the company tells me that there's nothing they can do about it because their software can't handle that exception, or just because they don't believe me.
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