I wasted a million credits today trying to put my BM mods on other gear, this was the biggest (now that RWZs were cut) part of the patch I was excited about... I'm pretty mad.
Oddly enough, the old gear in your inventory would highlight active bonuses when you have its mods on an equipped item, but they wouldn't actually apply to your abilities or stats.
So yeah, did they ever actually state that only the war hero mods would work for set bonuses?