This situation exposed a big problem with the NCAA rules IMHO. Essentially, as long as the snapper and QB can get together and make an exchange and get the ball spiked nothing else matters. You can have an ill formation, everyone moving, some still downfield beyond the line, some coming in and some going out and all the offense will suffer is a five yard loss. I would like to see the NCAA address this situation as the NFL has and assess a required time runoff so the offense cannot take advantage of this situation. At the very least in this situation I would have given them the harshest penalty I could under the rules which would have been 15 for illegal participation.
And I do agree that with the mass substitution that was attempted that the Umpire should have held the snap.