AP ran an article a couple of years back on a guy who owns a old camera gun - ie a Lewis machine gun with the internals replaced by a camera - whose use in public places, IIRC, is covered by aspects of current firearms legislation but I can't remember seeing anything about the Photosniper kit.

I suspect that the Terrorism Act(s) are not that specific and are rather more written to allow the authorities to define anything they take a dislike to as contrary to the law. I don't believe the Photosniper outfit is actually illegal but I certainly think that in the current climate of public paranoia using one in a public place would be very unwise...