@krobinson81, we have the same problem where we undertake 'longtitudinal crosslisting' where we treat, for example, Dissertation modules as 'roll-on roll-off courses' throughout the year with a single site and multiple sections for each of three trimesters.
Normally where a student is removed from a section in our SIS they will be marked by our system as "Inactive" on the Canvas course roster and continue to be visible on the course roster, but without access rights etc. (other Canvas statuses may be used in other institutions).
When a student is removed from their SIS section, but then readded to a later SIS section in the same crosslisted course, then the inactive flag is removed, but leaving the student with what appear to be two active sections. For example the student defers Trimester 1 and re-enrols in the module in Trimester 2, but appears to be live in both.
This is generally an uncomfortable position to be in, as it cuts across the use of section specific communications, activities and assignments. Where, for example, Section is the basis for enrolling students in assignments, then 'dual enrolment' students will have access to both assignments. Fortunately in our institution we have moved to individual student enrolment so this doesn't arise, but can still impact formative assessments etc.
Our current workaround is to manually make a new section named "Transferred from [old section ID]", remove the redundant section from the student, and readd them to the 'Transferred from" section. This restricts them from the old section whilst maintaining a historic record.
We also keep a module level hidden 'Change Log' in the form of a discussion, and would record the changes there for audit purposes.
As @chriscas identifies, there can be unintended consequences so this does need checking through with your Institutional Canvas team,
Overall this is an area which could do with refining by Instructure, but if your institution has a SIS based enrolment solution, then it may be that a solution could be programmed in.