How did I miss this thread!? Well better late than never I suppose...
I agree wholeheartedly with Michael, there is no controversy. Any knowledgeable collector worth his salt knows the "Oval" O is the genuine wartime issue badge. Period.
I have personally known, talked to and seen the issued badges of over 20 veterans of this regiment from senior officers down to Troopers like my father. Every single one has been an "oval O". Some had more than one badge in their possession, again all "Oval O's". I also know a couple vets picked up type 2 badges (Round O's) while on holiday in England post 1970's. That speaks volumes as to what came when...
I am not sure just whom these skeptics are that this dealer claims are out there... I'd like to meet one? "Equal and opposite opinions" ??? This is just hot air on the part of this seller.
The exact origin of the "type 2" badge (or more importantly, the actual die) does comes into question and I despair we'll never know the exact truth. However, it is true that some type two badges can be found in a very yellow (cartridge) brass with stubby "Gaunt" type lugs as the type 1 wartime issue (and the Bronze OSD version). I have three examples of this type of badge in my collection, they are quite different in weight and thickness when compared to the more common "redish" gilding metal repro. Does this mean the type 2 die and these yellow brass strikings are contemporary to the type 1 badges? Maybe. Other than the evidence of wartime type lugs (which can easily be faked) there is no evidence to link them to the regiment or to wartime manufacture. Personally, I think it is doubtful as there was never any reason to create a second die during the war.
The regiment only ordered 1000 brass badges (avg. Strength was approx. 550 all ranks). According to correspondence between Gaunt and the regt's CO, Lt. Col. Churchill, all 1000 brass badges were stamped as of early January 1945. 500 were finished and ready to ship (rec'd early Feb.), the remaining 500 would be finished and shipped later (rec'd Mar.). paid for in Sterling by regimental funds. End story. At the regiment's disbandment in june 1945. Many men and officers connected to QM Stores took home small caches of left over cap badges and collar badges. This is also why there can still be found some absolute pristine examples of genuine badges.
A far more intriguing question in my mind is what happened to the original Gaunt (type 1) die and where is it now... !?