Well since this is an official NFHS interp. I would say if it ever happened in a game I was umpiring I would rule as they have noted. My personal take on it? I think as it is listed it seems "fair" if you can do that. Each team violated a rule, each "lost" something because of that violation. Defense lost one out, offense lost a run.
I also don't think it has a very high likelihood of ever happening, but neither do a lot of things that we discuss here but if they do we have hashed them out prior to being surprised on the field.
Sniper,
They did appeal prior to the next pitch. If you look at the illegal sub section it allows that illegal player to be in the game for any amount of time prior to an appeal. A smart coach will see it but not appeal until that player has been involved in a play, so the penalty of "erasing" the out they were involved with will benefit their team. 3-4 Art 3:
Code:
ART. 3 . . . Illegal defensive player is discovered before the next pitch to either
team when:
a. involved in a play with batted ball;
b. a non-batted ball is handled or touched by an illegal substitute that leads to
a runner being put out;
c. a non-batted ball is handled or touched by an illegal substitute that alters
the play, but no runner is put out (i.e., on an overthrow on a stealing runner,
the illegal substitute retrieves ball and prevents runner from advancing
farther).
PENALTIES: (Art. 3)
1. The illegal player/substitute shall be restricted to the dugout/bench for the
remainder of the game. (Art. 3a, b) Team on offense has option of taking
the play or accepting the penalty (out is nullified, runners return to base
occupied at time of pitch.) (Art. 3c) Umpire may award bases based on
his/her judgment and the circumstances concerning the play. (Art. 3a) The
batter is allowed to bat again with the same count. (Art. 3b, c) The pitch is
canceled if it is a strike or stands if it is a ball.
2. After another pitch, all play stands but the illegal player/substitute is still
restricted to the dugout/bench for the remainder of the game.
3. Any time a non-batted ball is handled or touched by an illegal substitute
and does not lead to a runner being put out or alter a play, the play stands
and the illegal substitute is restricted to the dugout/bench.