- agetty would inherit the controlling terminal of the shell it launched from, and it doesn't know how to dissociate itself, so it would still need a tool like setsid
- agetty launches login, which needs root permissions, so you'd still need sudo
- agetty/login reset the environment for the new session, so setting those environment variables would have to effect
- not a semantic problem, just a syntactic one, but agetty manages the TTY named on its command line, it doesn't pay attention to its stdin/out/err, so the redirections wouldn't help
Taking all those changes into account, you get the command line from the "no job control" section at the end of the article.
TERM=vt102 LC_ALL=C COLUMNS=80 LINES=24 /bin/sh </dev/pts/10 >/dev/pts/10 2>/dev/pts/10
Can you run this instead?
TERM=vt102 LC_ALL=C COLUMNS=80 LINES=24 /sbin/agetty </dev/pts/10 >/dev/pts/10 2>/dev/pts/10