After re-reading the exchange I think my question was wrong because I was focusing on the wrong part of the question. The orignal question, "... Is it possible for a temporary table to survive that execute statement? ..." Which was answered with a "yes, but ... "
Really, my question was NOT the fact that the temp table disappeared -- I expect that behavior -- but mis-directed at the "Yes" portion of the "Yes, but". My question was what are the circumstances in which you can use "exec ('create ...')" to create a temp table and expect that the temp table would persist beyond the exec statement; I hadn't observed that before. So I think the aim of the question was off to begin with. Sorry for confusing things.