Where conduit is the recognized grounding conductor, does this mean an EGC can be run but allowed to be undersized? Im thinking of what in code would say this is wrong.
No, a full sized wire EGC, if ran, must be sized per T250.122.
250.122 Size of Equipment Grounding Conductors.
(A) General. Copper, aluminum, or copper-clad aluminum
equipment grounding conductors of the wire type shall not
be smaller than shown in Table 250.122, but in no case shall
they be required to be larger than the circuit conductors supplying
the equipment
No, a full sized wire EGC, if ran, must be sized per T250.122.
250.122 Size of Equipment Grounding Conductors.
(A) General. Copper, aluminum, or copper-clad aluminum
equipment grounding conductors of the wire type shall not
be smaller than shown in Table 250.122, but in no case shall
they be required to be larger than the circuit conductors supplying
the equipment