illegal ball... illegal pitch?

[dfeigin@yahoo.com]

Situation in my son's 13-14 year old Pony baseball this afternoon: Several pitches by home-team thrown to batter, who grounds out to first. HOME TEAM manager asks to examine the ball after the play. Ball is found to be illegal. Apparently it had been returned to the field when a legal ball had gone out of play. Visiting manager suggests that the batter should return to bat and the out should not stand. Umpire says it stands. Claimed that since the HOME Manager called it to his attention, he should not penalize that team. I said "baloney". The best I can find in the rule book is that a ball illegally altered should be an illegal pitch, and should be counted as a ball, if at-bat manager does not wish for the result of the play to remain. (No benefit to him in this case). Questions are: 1. Shouldn't the umpire negate the play, and add a "ball" to the count?
Secondly, if, according to the rules, the at-bat manager has the option to allow the play to stand if it is to his advantage, does that mean that if the pitcher threw a tennis ball (or a Spaldeen or Pensie-Pinkie!) and the batter hit it over the fence, the home run would count? I realize this would be very unlikely, but..... the question is, if an illegal ball is thrown (not an illegally ALTERED ball), and is driven for a hit, shouldn't the hit be negated as an illegal pitch? thanks