Sorry, I belong to the AMA. I fly at AMA fields (two at airports), and we can and do fly above 400', all the time. Not trying to derail any "fight".
SD
Kidding aside...
Coming from the AMA as I'm a long time AMA member, the safety rule has always been within 3 miles of an airport stay under 400 feet. Apart from that, the guideline was, if you plan a flight above 400, you needed a spotter, which isn't a problem and at a flying field that is a very open field, you can see any low flying manned aircraft coming from 5 - 10 miles away. So going above 400 isn't an issue at all, even over 1000 foot... Many jet RC planes hit 1000 foot in seconds flying at 150-250mph. Even a 40 size trainer flying 60mph, hits 500 feet rather quickly.
In fact, flying at or above 400 feet is quite the standard at air fields when training a new rc plane pilot, it's standard procedure to take the plane up and let them learn way up, and should something go wrong, you have time to recover, it's actually a safety rule for first time fliers at many fields.
So going over 400 feet isn't unusual, but this is done at flying sites, air controllers know about them and you will have a few spotters around, not a big deal.
What the FAA is/was worried about was a bunch of new pilots who have _never_ flown before taking their aircraft up high even in neighborhoods near airports. Where I live when the wind is out of the south the airplanes fly right over head at about 1000 feet, even know I'm over 5 miles away from the airport. If some new guy started flying here without knowing rules, guidelines, general common sense, etc that could be a danger, plus in a neighborhood you have trees, houses normally that are blocking the view long range so you only see things dang near right over you. In this case common sense would say keep it lower. But these new guys have no idea, they didn't come up at the AMA fields, never touched sticks before apart from some $20 indoor flight "maybe".
But there is no reason to flip out on someone who flew over 400 foot. It's not illegal, stupid if your within miles of an airport, perhaps illegal close to an airport, but if your 5 or so miles away there is nothing wrong with it, granted if there is an airport with a tower even 7 miles away, you should give them a call and see if conditions are safe to fly, just tell them, "Hey I plan to fly a "UAS" at 500 feet and lower, everything ok with this?" And they will tell you yes or no, or give you a set alt. I've even heard things like "No issues, sky is yours to 2500" 9 out of 10 times, even if your within 5 miles, they will clear you to 500 foot, just depends on weather conditions and how they are running things for that day. We've even called them at the field... Those guys are professional and most times very accommodating.
I've also heard in the coming weeks, the FAA is changing their website to be more in line with the AMA safety rule set, which allows for flights over 400 feet.
So that's the reality of the matter, people have been flying over 400 feet for a long long time. No reason to get ugly about it, nothing wrong with it if done properly. The FAA is just trying to get some common sense into folks who are just "starting" out. They have admitted this many times. FYI, the FAA does _not_ have the authority right now to make "new" rules on hobby model aircraft, and I don't see that changing any time soon. The registration part isn't a new rule, but the expanding of registration to include all aircraft. It's kind of a mess right now, but the new rule set is coming and I think they will do a good job on it.
J/K, I usually stay at 400' max...but long range flights could definitely benefit from 600-800' ceilings (tried once or twice very near me with no planes in sight or sound), just too dangerous with those little planes flying around at long range.
