Kristopher,
You are correct - SWG will use IP address. This is because in most customer cases, SWG cannot reliably get the MAC address of a host since it is typically either on a different subnet than the host (such as the subnet of the firewall or gateway device) and/or there is a router in between SWG and the host. The SWG quarantine feature works best in environments that do not employ heavily dynamic IP addresses.
We are investigating other methods such as Dynamic DNS or MAC address IP lookups on the DHCP server for improvement in future releases of the product.