The Feds specifically declined to prosecute for this.
It’s a very bizarre legal theory, and also I believe entirely untested and hugely problematic as you say.
Edwards used actual campaign donations to payoff his mistress to the tune of $1mm and they brought charges and he was found not guilty by the jury.
Here we have a long-standing “fixer” for Trump doing something he had always done and had a history of doing for Trump, with or without a campaign ongoing.
Calling it a campaign finance violation for a business partner to do the legal things that they always did is absurd on its face, besides the fact that such a law would put every politician everywhere in legal jeopardy, and yet surprisingly this theory seems to only be trotted out against Trump!