Most of the other referees I have spoken to believe that Jon Kaplan was primarily at fault for this.
If you watch the video and listen to he and the Assistant Referee Peter Allen talking, you can hear Kaplan cutting him off in mid sentence. Allen was trying to explain what happened and Kaplan just cuts him off, wanting a yes or no answer to a question which required more than a yes or no.
1. Allen was standing on the line-of-touch with his flag raised and his other arm out. This indicates the possibility of a quick throw in is ruled out.
2. When the Welsh player throws in the ball, Allen allows this as a quickly taken line-out, (which is not the same as a quick throw in)
3. Kaplan has his back to all of this, and doesn't see any of it.
4. Kaplan thought it was quick throw-in and he asks "Was it the correct ball"? (note: he didn't ask if it was the same ball, and this is crucial)
5. Allen replies "Yes" because he is thinking quick line-out, not quick throw in, and he knows it doesn't matter which ball is used.
This was all down to a cock-up in communication. Kaplan asked the wrong question, and then would not allow Allen to talk to him. Allen may cop some of the blame for not being assertive enough, but the responsibility for this error lies fairly and squarely on Kaplan's shoulders.