It is explicitly stated that British Subjects are not allowed to use foreign titles. That doesn't seem to be the case.
John Kersey is referenced. In a very detailed analysis, he shows that there is no actual prohibition, rule or law to that effect. Foreign titles are no longer official recognised but may still be used as courtesy titles, he compares them to the courtesy titles used by heirs to peerages, some of which are actually made up!. Indeed they may be recorded as an Observation in a British Passport, effectively a form of recognition in an official document.
It certainly seems to be the case that the use of foreign titles is discouraged but not actually forbidden, a classic fudge!
I suspect the Princess Beatrice's husband does not use his Italian title in an effort to "not rock the boat" not because he's not entitled to do so.
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