Is a scalp micro-pigmentation (hair tattoo) prohibited in AR 670-1? Has anyone ever had to address a soldier with one?

How are you going to say that AR 670-1 says that a tattoo on the scalp is prohibited then ask "Is it prohibited?"

It literally says that one cannot have any tattoos on their head so that would include the scalp it seems. If someone is found to have a tattoo in a prohibited area:

e. Commanders will perform an annual check for new tattoos or brands above the neckline, wrists, and hands. If any unauthorized tattoos are found, the Soldier must be processed in accordance with paragraph 3–3f. Tattoos on the face or head (to include on or inside the eyelids, mouth, and ears) were never authorized locations for tattoos. Soldiers with tattoos on the head or face must be processed in accordance with paragraph 3–3f, unless the Soldier received a written waiver upon entry into the Army. Commanders will also conduct a simultaneous check for extremist, indecent,
sexist, and racist tattoos. If such tattoos exist, the Soldier must be processed in accordance with paragraph 3–3f

The only thing it says is "unless the soldier received a written waiver upon entry into the Army." So if they don't have a waiver for it, that's a no go.

If you found it in the reg, then it's a no-go, You can always check with JAG for clarification.