The sword BAN is only for cheap swords that anyone can buy on the net. Shops that make genuine Iaito's in or for the UK will be aloud. If you are a practioner you can own a sword, I would think that some kind of registry will be enforced for buying new swords. If your sensible and only carry your swords to training/displays with your MA licence also carry it in a bag or case you will be fine. With in a few weeks UK shops will be selling their Iaito's again.
http://www.opsi.gov.uk/si/si2008/em/...0080973_en.pdf
That link will tell you the legislation.