Figured out why the truncation is occuring. Here posting the results as the answer to the problem; my use of [nvarchar] to contain data of type [varbinary].
As an example:
SELECT CAST('0x50004F0049004E00' As binary) -- 0x307835303030344630303439303034453030000000000000000000000000 ( ascii code: "0x50004F0049004E00NULNULNULNULNULNULNULNULNULNULNULNUL")
SELECT CAST('0x50004F0049004E005400200028002D003100320032002E00340031003500' As binary) -- 0x307835303030344630303439303034453030353430303230303032383030
SELECT CAST('0x50004F0049004E00' As [nvarchar](128)) -- 0x50004F0049004E00
SELECT CAST('0x50004F0049004E005400200028002D003100320032002E00340031003500' As [nvarchar](MAX)) -- 0x50004F0049004E005400200028002D003100320032002E00340031003500
SELECT CAST(CAST(@rs.STAsText() As binary) As [nvarchar](MAX)) -- POINT (-134.00
SELECT CAST(CAST(@rs.STAsText() As binary) As binary) -- 0x50004F0049004E005400200028002D003100320032002E00340031003500
DECLARE @regstr [nvarchar](MAX)
SET @regstr = CAST(CAST(@rs.STAsText() As binary) As binary)
SELECT @regstr As [binaryStr]
SELECT CAST(CAST(@rs.STAsText() As binary) As binary) As [binaryStr] --
SELECT CAST(CAST(@rs.STAsText() As binary) As [varbinary](MAX)) -- 0x50004F0049004E005400200028002D003100320032002E00340031003500
(In order to better see the code in these PRE tags click on the "Copy Code")
So, in conclusion ... I CAN get the binary string @binstr by using the right type(d'oh)!, [varbinary](MAX). The operation in the SELECT clause returning the abbreviation as an unknown conversion is some sort of default behavior. Unexpected but not necessarily as wrong as redtext error.
Even more info:
ms-help://MS.SQLCC.v10/MS.SQLSVR.v10.en/s10de_6tsql/html/65353777-e3e6-461c-9504-ea4d83312692.htm