Officials said he was allowed to stay in the tournament under a new rule that keeps players from being disqualified based on television evidence.
http://sports.yahoo.com/news/woods-penalty-drop-under-review-124339119—golf.html
I think the 2 stroke penalty is fair - that is what he would have gotten if they told him at 18 that he had incurred a penalty. He would have then dropped the 2 strokes from his score and signed for the -1.