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Billy Mac,
Your "top-notch" colleagues botched this one. You and the senior official are correct.
In addition to what the others have posted, the NFHS issued an interpretation THIS very season to clarify this situation after the back and forth rules book snafu.
Show your fellow refs this:
2007-08 Basketball Rules Interpretations
SITUATION 3: During an alternating-possession throw-in for Team A, thrower A1 passes the ball directly on the court where it contacts (a) A2 or (b) B2, while he/she is standing on a boundary line. RULING: Out-of-bounds violation on (a) A2; (b) B2. The player was touched by the ball while out of bounds, thereby ending the throw-in. The alternating-possession arrow is reversed and pointed toward Team B's basket when the throw-in ends (when A2/B2 is touched by the ball). A throw-in is awarded at a spot nearest the out-of-bounds violation for (a) Team B; (b) Team A. (4-42-5; 6-4-4; 9-2-2; 9-3-2)
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