Steve, we are dealing with 701 only. No emergency equipment is being shown as powered from the electrical distribution system. So I infer they plan to use batteries for the egress lights.
Ron, I saw the "with the AHJ's blessing" part. But you need to look further upstream. You don't get to sub paragraph (E) without first encountering the text of 701.12. The relevant words are, "The supply system for emergency purposes, in addition to the normal services to the building . . . shall be one or more of the types of systems described in 701.12(A) through 701.12(E)." So I don't see how using just a tap ahead of the main as the only source can satisfy this requirement.
On the other hand, I also don't see the value in using a feeder from the normal distribution system, using a feeder tapped ahead of the main, and using an ATS to switch between the two, as having any value. As John pointed out, odds are that they both go down together. That calls into question the purpose of 701.12(E) in the first place.