Yes, blanks would be called "live" even though they aren't bullets - they can indeed kill someone (like happened with Jon Erik Hexum) at close range. That's why they're treated as "live."
To make it more confusing, there is some concern that it actually WAS an actual bullet - there are stories of people target shooting on set. Nothing on a set should be capable of doing that.
Any gun-appearing item on a set is treated as a gun. They don't "lie out on carts" to be picked up. They're taken from the weapons master and returned to the weapons master who locks them up. Even if they're solid rubber. You can't wear it to lunch. You can't wear it to the can. I saw a dude politely fired for wearing his "gun" to crafty to get a snack. "Sorry, we're going to have to send you home."
When we shot the riot on OitNB the safety meeting happened repeatedly for a gun that was one solid piece of metal because it was being drawn and pointed at people. On a quiet set, the AD (standing with the weapons master) held up a the gun and said: "This is solid metal. It cannot be fired. It has never been a real gun. It has no moving parts. It is as heavy as a real gun and could hurt someone if used to hit them. We are not doing that in this scene. The barrel is blocked. It cannot be fired. ::shines flashlight into barrel:: "If anyone would like to inspect the gun please raise your hand."
Then he brought it to people who had raised their hands. And a few people who hadn't raised their hands. We did some version of this every time we left the set and returned to it - lunch, breaks, turn-arounds. One time I did take a look at the gun, shine the flashlight in the barrel. When it was pointed at me later I was really happy I had. Shooting riots can get scary. Obviously you know its pretend (you're on a sound stage, there's cameras everywhere) but you're trying to get upset and everyone around you is trying to get upset and there's yelling and sometimes smoke. Sets are hazardous even when you're not shooting a riot - there's cables everywhere, booms, and cameras and light rigs swinging around. Everything was put in place to be broken down easily and an area that was clear for your exit five minutes ago is a pile of stuff now. And you're incredibly careful with even the coldest of cold guns..
Tom's article makes me wonder if they hired someone relatively inexperienced they could push around in the name of "saving time."