The three Americans to receive the French Legion of Honor medal. Where would this go on the two service-member's bar, if at all?

A1C Stone's unit has nominated him for the Airman's Medal and the CSAF has stated they are looking in to the Purple Heart.
"We are looking at the potential, to see whether we can award the Purple Heart as well," Welsh said, but it will first have to be determined whether the train incident was an act of terrorism. The 2009 attacks at Fort Hood, Texas, by then-Army Maj. Nidal Hasan were eventually ruled to be terrorism, making victims eligible for the Purple Heart.
http://www.military.com/daily-news/2015/08/24/us-air-forces-captain-america-receive-airmans-medal-heroism.html

Now it seems paradoxical to award one "Combat" award (PH) in conjunction with a specifically non-combat award (Airman's Medal) but we will see how it plays out.

I think it would have far more to do with how France and the US would classify the nature of the attack to determine if a Silver Star or other award is warranted. They are considering Stone for the PH would also suggest that they are considering this one a planned attack from a known group with hostile intentions towards the United States or its allies. While if this was confirmed ISIS or Al-Qaeda, itll warrant the PH, the Silver Star on the other hand, they theoretically could.. and would consider doing so so, as to not let the French 'out honor' one of ours.

SSG, you could be right. However, I believe the first place to look would be the awards manual for each branch of service. If that doesn't work, then the next step would be to seek help from your chain of command. Going right to JAG would likely cause unnecessary discontent within your chain of command. You've been around long enough to know that you don't go right to Z without going to A,B, and C first. Just a thought.

SSG, there's something else to keep in mind. In the wake of Operation Desert Storm, the government of Kuwait awarded the Kuwait Liberation Medal to those who participated in Desert Shield and Desert Storm between 2 August 1990 and 31 August 1993. That medal was later authorized for acceptance and wear (via memorandum from SECDEF) by members of our armed forces. It's always possible that the current SECDEF could do the same.

MSG Brad Sand State awards are still higher precedent than Foreign awards, as they are considered "US."

After reading through those PDFs, SGT Aaron Barbee I believe these instructions were written by politicians. They are written in such a way that without really studying what they say, they can get a service member in deep shit.

True, the way they are written can cause issues, but from my experience pretty much all regulations read that way.

State awards are worn following foreign service awards. Additionally state awards are not authorized for wear while state units are on active federal service.

PFC (Join to see) - your validation is not valid??

SGT Brian Nile - Quite valid. Just as an example, Estonia is not on the official list for anything but several hundred US service members have approval to wear their badges.

PFC (Join to see) - prove it ??

SGT Brian Nile - Somebody else already has, fell free to dig for it. It starts commenting about how an officer as low as an O-6 can approve the wear of a foreign decoration. I'll let you find the actual post as a form of leader development.