In my opinion, both rulings are wrong.
When the last action pre was a call of a pot raise (not an all in), and everyone flipped their cards over, they all lost the right to make any further aggressive action (ie they can only call or fold - but as there is nobody left to make a bet, that is irrelevant). With all cards on their backs, and no more aggressive actions to come, the pot should stand at the point of the last call, and the board should be dealt out, with main and side pots dished out accordingly.
To try and say that there was still action to come after the flop, so the turn and river should be redealt, even though everyone had seen everyone else"s cards is just ridiculous. And in the revised decision - to decide that the pot raise was actually an all in because the guy calling was intending to call all in, even though they were too deep to get all in, is also ridiculous (it just sets the wrong precedent for Pot Limit tournaments)
The players screwed up by flipping their cards over on the assumption that everyone was all in, before the dealer had counted stacks and bets. The dealer screwed up by not commanding and directing the table properly. The TD screwed up with a flawed decision in the first instance. The WSOP senior director screwed up with a flawed ultimate decision (albeit that was probably a reasonable outcome for all concerned).
Who"d be a TD eh?