I direct your attention to page 2-7 of the Dec 2001 LS8-18 Flight
Manual. In Section 2.10 Minimum Equipment List, it states "Magnetic
Compass. Under the following paragraph Additonally for Cloud Flying it
states "Compass".

I doubt I'll receive an apology...

You doubt correctly. Im my flight manual (the original German one), I
read on page 2-11 (not 2-7) (ad hoc translated by me):

Minimal equipment: airspeed indicator, altimeter, thermometer, radio.
(But *no* compass.)

Additional minimal equipment for cloud flying: turn indicator, compass,
vario.

So there's something fishy with your manual. And yes, no apologies.