From what I can tell, and it is confusing even with Greg writing it, the King was not subject to the Marriage Act and could marry anyone he chose.
In theory, David was free to marry whomever he wished. He was regulated, not by written law but solely by tradition and accepted custom. Because England had no written constitution, may laws were only situational; a certain amount of government flexibility existed in the definition of what could or could not be done. This somewhat ambiguous allowance would not only serve the King, but would work against him throughout the fall of 1936.
Members of the British Royal Family as well as those indirect line of succession to the throne were governed by two different legal statutes. The first, the act of Settlement, had regulated the passage of the British Crown to the German House of Hanover and stipulated the passage of the British Crown to the German House of Hanover and stipulated that potential heirs and successors could only marry a Roman Catholic on forfeiture of dynastic rights. The second statute was the Royal Marriages Act, which decreed that all members of the British Royal Family as well as potential heirs in the line of succession were required to obtain the sovereign's consent before contracting a marriage. Although the King, as sovereign, was obliged to follow the dictates of the Act of Settlement, he was himself exempt from the provisions of the Royal Marriages Act.
The ruling government of Great Britain had no legal authority to impose restrictions on the marriage of a king or regnant queen. Not was there any constitutional requirement that the sovereign seek the permission of the prime minister or his cabinet. In short, there was nothing which allowed the government of the day to raise any objections to the marriage of the King.