I know of quite a few folks that have removed the red regulator. The pressure is regulated out of the bottle through the fitting, it would not exceed the capacity of the iron pipe, it's connected by a rubber hose isn't it, that holds the pressure. The red regulator is so that when you turn that bottle on it fools the opd and safety override in the bottle to think that there is not a leak, so that it doesn't shut the bottle off. Without the red device you need to turn the bottle on very slowly until pressure in the crossover pipe is stablized.
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