There is an article in SWAT magazine November 2009 in which they tested the 7.5" Troy Industries 7.5" offering in the AR platform. They shot a Safariland Class III vest at 50 yards with Hornady 5.56mm 75-gr. BTHP/WC T2. It cut through the vest, plate (I presume soft plate), and dummy and the back of the vest.
The velocities you can get from the 7.5" barrel will be enough to expand Nosler Partitions out to about 90 yards.
Exactly how are you "handicapped" by using a .223 in a short barrel platform? Muzzle blast, concussion, yes. Round performance isn't a concern out to self defense range.
The pistol length gas system is higher pressure, but with the correct barrel gas port, it functions very well. I've used one in 3 gun matches, and it will run a whole day without cleaning. However, it does get dirtier than the carbine length ar gas system.
The SBR is more practical, no doubt. However, the AR pistol fills a niche for those who can not have SBR's. I keep one merely because I can load up all my magazines and drive to a 3 gun match without worry of having "loaded rifles" in the car. Those magazines are for my AR Pistol, which is quite legal in this state.