the state inspector man running the machine will click the YES box to the question on the machine "is this a diesel" (and older than 2008) then it bypasses all the emissions crap during inspection and only prompts the safety questions. ( i used to be an inspector in texas, in an emissions county) then your inspection will be complete and you will get a sticker.
awd cars are also exempt from dyno too. just a two speed idle.(if its a gasser)
registation is registration. they bill your vehicle by weight, not what the engine is. and since its not a CARB state, they dont care what engine it has.