The way the removal of the halo was explained to me (by a senior BigTen White Hat) was that the NCAA Rules Ctte was not happy that so many technical 5 yd KKI penalties were being given because a Team A kid had slightly entered the halo, eg running past the KR before the ball arrives. So they rewrote that rule to try to eliminate those instances.
Furthermore I was told that while there is no longer a halo, that 2 yards in the front sector of the KR remains a good starting point in your decision on whether the KR has an unimpeded chance to make the catch.
Watching the film, I thought KCI straight away. That KR has gotta be blind and deaf if he doesn't realise that the Team A kid is directly in front of him. Pause the Youtube footage of the replay at about 0:57. When the KR first gets hands on the ball, the head and shoulders of the Team A guy are about a foot away. That sure as h*ll would put me off making the catch, and I figure likewise for that KR.
Ask yourself this. If this play had happened under the old 2 yard halo rule - would you have had a flag? Sure you would.