Serious question: wouldn't the SEC say "no way" if that 49.9% constituted more than 500 (at least, I believe that's the number) people?

No, they'd just require the private company to disclose the same sort of quarterly information that a public company does.

You're clearly alluding to Facebook being "forced" to go public, but they too could remain private with 501 investors. But once they're revealing their numbers, they figured they might as well jump in with both feet and do the IPO.

Typically when a company goes private, it buys back the shares from the current shareholders. The number of shareholders would then drop back under 500.

Yes.

if (NumOwners >= 500) public = true;

Actually, I think the rule is >500 investors, you have to publicly disclose financials a la Sarbanes–Oxley Act.

Different than being a publicly traded company.