Using NatFed rules:

Free kick from the K40 (kickoff). Team K attempts an onside kick. Before the ball travels 10 yards, the ball bounces up and touches K1 in the chest at the K45 yardline. R1 possesses the ball and begins to run. R1 then fumbles at the K35 yardline. While the ball is loose, R1 clips K2 at the K25 yardline. K3 then picks up the ball and scores a TD.

What do you rule?

I think you have to give the receiving team the option to take the ball at the point of first touching by K, or penalize K five yards and have them rekick, or accept the result of the play. I doubt they will take the result of the play as it reulted in a TD for K. If for some reason they did take the result of the play, then K would have to decline the clipping penalty in order to score the TD.

R doesn't have a choice. K does. So it's a TD for K or re-kick from R's 45.

As stated in 6-1-6: ... The right of R to take the ball at the spot of first touching is canceled if R touches the kick and thereafter during the down commits a foul or if the penalty is accepeted for any foul committed during the down.

First touching is not used to create a double foul, and the foul happened during a loose ball play which is enforced from the previous spot (if K was dumb enough to give up the TD).

This foul did not happen during a loose ball play. It happened during a running play because the kick ended when R gained possession of the ball. The foul happened while the ball was loose, but not during a loose ball play. R's right to take the ball at the spot of first touching is cancelled since they committed a penalty on the play. K is more than likely going to decline the penalty and take the touchdown. If the penalty is enforced by some odd reason, it would be enforced from the end of the run (the 35yd line where the bean bag should be down since this is the basic spot for a running play.)

Thanks NYJets for the catch. You are very right about it being a running play and being assessed from the end of the run (spot of fumble).

It doesn't really matter whether it's a running play or a loose ball play. I'm quite sure that K will decline the penalty and take the TD.

(On my own imaginary microphone) AFTER FURTHER REVIEW!! I'M AN IDIOT FOR POSTING A REPLY WITHOUT READING MY RULE AND CASEBOOK!! Sorry about that guys/gals.