Batting out of order

[ptman]

Today's Mariner-Blue Jay game: Bottom of second inning. Due up for Jays -- Hill, Overbay, Zaun. Overbay leads off instead of Hill and flies out. (One out) Hill then bats and doubles. Mariners now appeal improper batter.
According to the reports I have read, umpires called Hill out (two outs), and Zaun then came up to bat and struck out. (Three outs)

The Associated Press report erroneously claims that Overbay then batted ahead of Hill for the remainder of the game. Not true.

My interpretation of the "batting-out-of-order" rule (6.07): Overbay was an improper batter. When a pitch was thrown to Hill, Overbay's at bat was legalized and the next proper batter was Zaun. So now Hill is the improper batter. When the Mariners timely appealed Hill's improper at bat, the umpire should have called the "proper batter", i.e. Zaun, out. The next batter should have been McDonald, who followed Zaun in the lineup.

Why is this rule so confusing to umpires?