Sales order status override is causing incorrect hard commitments of inventory

We are using Advanced Preference Type 24 (Next Order Status) to block entry of specific items to certain foreign countries.  When the right customer/item combo is entered in sales order entry this preference is set to flip the next status to 521.  This creates an error since the 521 status is not valid and it is a signal to our order entry staff that this item cannot be sold to this customer and then they will cancel the line.

We do have some exceptions to this rule and typically we will have order entry staff manually change the next status to 524 in such an occurrence.  When we do this we are finding that the inventory is being hard committed.