Personally, I think it should be fully disclosed machine or hand stitched. Better to avoid confrontation. You could always say "Hand made by machine." Or Hand made with machine stitching.
When I hear hand made I do think it was all done by hand, needle and thread instead of machine.
But I put this in the same catagory as Hand Guided or Computerized Quilting. I think it should be fully disclosed as to which was done.
As I said, that is my opinion, I don't like being mis-led in any way so I try not to do it to others.