3-2-3

[Dave Reed]

One needs to have an actual infraction of the rule in order to invoke the penalty. You haven't quoted the relevant section of the rule fully. It is
nor shall the base coach or members of the team at bat fail to vacate any area needed by a fielder in his attempt to put out a batter or runner.

Nothing in the original post suggests that a fielder was actively trying to field the ball, or attempting to put out a runner or the batter. I don't think I've ever seen a person authorized to be on the field pick up a ball in foul territory while a fielder is approaching with an obvious intent to play on a runner. Doing so would imply intent or a remarkable state of obliviousness, rather than he "thought it was foul." In other words, if the condition of this rule--fielder attempting to put somebody out--is met, an offensive teammate is very unlikely to touch the ball.

Siimilarly, if the batter hits a foul fly, and a offensive player (e.g. the kid protecting the bullpen) touches the ball in flight, you should only declare the batter out if a fielder was close enough to catch it. Otherwise it is just a foul ball, in spite of 3-2-3.