Hi James,
in fact, this looks like a defect in the SQL pre-compiler.
I can confirm, that this also happens under V7.5 (testet on PUB400) - I cannot find out, which TR or PTF-level is installed on that machine, but Holger keeps PUB400 normally quite up-to-date.
I seems to be in fact that last position in front of the "E" for externally defined - but I can't find anything about such a limitation in the manuals.
I would recommend to report that defect to IBM as a ticket.
HTH and kind regards,
Daniel
P.S.: BTW - it doesn't happen with a free form DCL-DS definition - so my recommendation is of course:
dcl-ds fullnametestbug extname('BUGTABLE') inz end-ds;
#RPG