Personally, I tend to be conservative with the interpretation of the first circular weld;- any long drain nozzle of a vertical vessel/column, sticking out through the skirt IS a nozzle upto the face of bolting flange, case(3) above. The vessel hydrotest is also the hydrotest for the whole nozzle. I have had cases however, with the Client requesting to weld a cap to the nozzle neck at the first weld, to enable the column hydrotest and perform B31.3 testing of the remaining nozzle neck piping. Weird and narrow code interpretation. Further, this interpretation opens the way to weld the remaining nozzle neck on site, after the vessel erection, when full hydrotest is out of question, because it only counts as field pipe weld...
jt, the pup solution is correct. Again, the pup and the flange will have to be tested separately, as per piping code, but the vessel with the nozzle neck cut short will remain untested as it is considered unchanged. In reality, with or withot pup you are adding a new feature to the vessel, the nozzle flange, which you should test to prove the whole vessel integrity. That makes it vessel modification which require full documentation to prove that the vessel is safe for use.
This might raise a few eyebrows, but it's still better engineering than no engineering.
gr2vessels