Mandatory vs Voluntary. One is forced by the government and one is not. This refers to the government forcing a company to recall or not. It has nothing to do with the end user or consumer.
In context, The CPSC was surprised that Samsung chose the voluntary option as there are additional protections for companies that wait for the mandatory option.
I don't agree with this.
In the most simple terms, mandatory is something you must do and voluntary is something you can choose to do. So the question is, what would make any act, something that you must do?
Well yes, the government could step in and with the appropriate legal framework, make something mandatory. (The necessary laws would need to be in place however. Governments in sensible democracies cannot simply decide to tell people what to do, outside the law.)
But government enforcement is not a necessary precondition for something to be mandatory. If you buy a car on a load agreement and you fail to make the loan payments, the loan company can ask for the car back and will be mandatory that you return it under the terms of the contract. You cannot say, "no I decide not to pay you and I will keep the car". Handing back the car is mandatory.
Similarly, Samsung could have - had it wished to - put terms into its licensing agreements that gave it the rights to mandatory recall in certain circumstances. I am presuming (although I have not read the agreements) that no such provision exists. If so, that was Samsung's choice. If such provision is in the licensing and Samsung are not using that provision to enforce the recall, that is also Samsung's choice.
Either way, it is/was Samsung's choice whether this should be a mandatory recall or not and either directly or through their actions, they have chosen "voluntary".
Since this is the case, it is entirely reasonable for any N7 owner also to choose to keep their phone.