If I read and interpret this correctly, in somewhat chronological order:

1) someone contacted U sports about "a player" at SMU, without presenting it formally
2) U sports contacts SMU, who says "What. me worry?"
3) U sports says OK we have nothing formal so let it go
4) SMU says put it in writing,
5) U sports says they will not pursue the rumoured issue
6) Formal proper complaint issued
7) U sports spirals, spirals, spiral
8) AUS says what's the answer
9) U sports spirals, spirals, spiral
10) AUS says what's the answer!!
11) U sports spirals, spirals, spiral
12) AUS says what's the f'en answer
13) U sports spirals, spirals, spirals
14) AUS says F IT. He was ineligible, so they get 4 more loses and should not have been in the semi. Cancel game
15) SMU calls lawyers, points to smoke screen in earlier stages
16) U sports spirals, spirals, spirals

From what I have read, SMU is pointing to U sports letter saying they were not going to pursue anonymous complaint, and put it in writing. They are ignoring the fact that a formal complaint came in the next day. Now they are trying the same tactics in the courts.

Who is to blame, innocent and screwed

Acadia - innocent
Bishops - innocent - no effect

SFX - maybe innocent, maybe screwed but no guarantee they would have beaten Mt A, maybe a conflict of interest, but throw that away because they did not get the extra game
Mt A - innocent, screwed out of a playoff game

SMU - blame - they used a player that by the rules is not eligible, which could have been avoided had they pre-qualified him. Then they blame everyone else and point fingers and go legal

AUS - some blame, optically looks bad, right on principle, certainly not on optics. 11th hour looks bad.

U sports - no matter how you cut - gets some blame and looks REALLY stupid.

Real victims - Mt A, X, Acadia maybe
Real Villains - SMU (how could they not be), AUS
Dumb henchman (not just because its a stupid name) - U sports