What you say is correct. With the PDair case for the 760/860 you do have to remove one of the plasic clips. The clip that retains the Z in the case snaps into the same spot.
I also don't think it will work too well with the small battery. The whole thing will be rather floppy.
The case is pretty good, especially for the price. I also liked the Extreme Limit case but they were sold out when I needed mine. I'm happy with the PDair. The only problem with it is the lack of a cutout to make removing CF cards easy. You can still do it, but it's a bit fiddly. Other than that, the quality of the leather and stitching is good and the fit is excellent.