Both of those make much more sense than the company line they are feeding us.I have one of the 357AR max guns pioneered by Moleman. I am a longtime 357 Max shooter. I followed the 350L closely when it first came out.
I have pondered the 0355" choice at length.
There are two explanations that actually make a little sense.
The 350L case is bigger at the base than the 223 and it is just long enough so that it is not practical to convert 223 brass to 350L. Now Winchester is all about selling 350L ammo and guns to hunters much more so than supporting the small fraction that reload. However, there was probably some consideration for reloading. Although many end users are not thrilled about the inability to convert 223 cases, it reduces the potential for the cartridge from getting a bad reputation from folks doing a poor job converting cases and then badmouthing the round. It also reduces the potential for stupid legal action when someone blow up a gun or gets hurt using converted cases. And thirdly, it had the potential to help sell more Winchester factory ammo and/or Winchester reloading components (the 350L was developed before the current ammo supply crisis).
The second potential reason is more likely to have been an actual consideration. The 357AR Max can be pretty tricky to get set up for proper feeding of the ammo into the chamber. The 350L has much more taper to the case and seems to be more forgiving in this regard. To increase the taper, they increased the case diameter just ahead of the rim. However, the amount of increase available to the designers was limited given that too much would affect how the round works with AR-15 style magazines. Going with 0.355" bullets in lieu of 0.358" bullets helped Winchester get more taper on the case without increasing the base diameter more than they wanted. I actually think the increase in case taper has been a big plus for getting the round to feed acceptably in the AR-15 platform.