Depends on if they find the circumstances... suspicious.

I am not sure how much surveillance they do - in reality for large lots this restriction may not hold, since trees can disappear at night, be chipped up, etc. But for people in the suburbs, to cut one you need to get a crew in, and there are probably reporting requirements. Also the neighbors love to get involved.

But I do wonder if a tree imperceptibly had branches die, be removed, and then just gradually shrunk over time?

A lot of these laws don't cause much harm in a pre-surveillance world. But once there are full cameras on everything, seeing how they apply at 100% enforcement can be scary. But by that point there are defenders for each one, so they hardly change.

The way people do it is to hammer in a nail that poisons the tree.

The tree dies, and needs to be cut down because it's dangerous to leave standing

A copper nail, specifically (drill a hole first).

Some jurisdiction will make you replace the tree in that case, just to avoid this sort of mechanism.

Yeah but the tree only has to be that diameter at final size. You can plant a dozen tiny trees too close then let them stunt or choke each other out

Some jurisdictions seem to be attempting to counter this sort of thing, and an aspect is: if you can't do it properly, we will, and send you the bill at our chosen rates. And we are going to check.