I think thats just a rumour about the DVLA, My mate sells cars from home full time and he's not registered as a trader. He's sold over 30 this year already and they've not said anything.
I do it to, not as many but i dont register the logbook in my name i just fill in the trade section and send that off. Never had any problems.
Edit: Taken from a motor trader info website
How do i get a traders license to buy and sell cars?
Not legal advice: No license needed for buying/selling cars, as long as you reveal you are a trader whilst advertising the vehicle for sale, and have all the relevant traders insurance that should suffice
How many cars can i sell privatly without being classed as a trader?
No amount of times are stipulated by the DVLA. A dealer must be registered with the DVLA for tax and insurance purposes. Not to do with changing cars.
Only licence you need to apply for from the DVLA if trade is for Trade Plates.