"Each proposal MUST clearly specify precisely where canonicalisation is performed (e.g. DNS resolver, DNS server)."
If we don't make the above clear, then the deployed result just won't be interoperable.
(1) Once in the local resolving server
(2) Once in the root nameserver
(3) Once in the server for se
(4) Once in the serevr for example.se.
(5) Once in the server for bar.example.se.
Ooooops....this was a CNAME...
(6) ...
(7) ...