Just a quick answer, as I have written about the playoff controversy elsewhere online extensively.
I’m sorry, but your questions seem rather hyperbolic and opinionated to me. What exactly do these observers believe was “degrading” or “demeaning” or “deviant” about the playoff?
• Is it the fact that the playoff (after four previous games that were split) came down to a wild mutual time scramble? Such time scrambles are a rare but definite possibility inherent in any chess game that is not using a delay or increment on the clock (including tournament games, not just blitz). This is not the first one to ever happen. But this time it was captured on video. Were all the chess games played before the invention of the Fischer Clock also deviant because they allowed a scramble like this to occasionally happen? Several big international tournaments recently had time controls with no increment on the clock — the 2008 M-Tel Masters in Bulgaria, for example. A time scramble could happen during these events (and I think did happen in a few cases). Was this choice of time control “degrading” and “deviant”? Of course not.
• Is it because the players are observed in the video beginning their move before the opponent punches the clock? This is an awkward possibility inherent in any chess game time scramble, including slow-play tournament games. It happens frequently in time pressure, but could theoretically happen at any time. When the time pressure is mutual, the problem is magnified and it gets ugly. Unfortunately the rules for moving the pieces are ambiguous and controversial on this point. Several imminent International Arbiters, such as Geurt Gijssen, to name just one I’m aware of, interpret the rules to be that it is legal to do so. If observers don’t like this, then they should demand the FIDE rules committee do something to clarify the rule.
• Is it because a blitz armageddon game was used in a playoff? Neither the USCF nor the FIDE rules discuss playoffs very much at all, and give very few guidelines to organizers, but it is my understanding that they both specifically mention blitz playoffs as a possibility, and the FIDE tournament rules even use armageddon blitz (5 to 4 with no increment) as an example of a playoff method if limited time is available. There are plenty of precedents for the use of such playoffs for important tournaments, (the 2003 U.S. Women’s Championship, for instance), and nothing in the rules that I am aware of against it. I’m not trying to justify it as the best playoff method — but I am stating that this indicates there is certainly nothing “deviant” about using it.
I’m sorry to give a flippant answer to your “official questions”, but trying to affix blame for the controversial playoff seems weird and inappropriate to me. I think a little bit of emotional reaction to the video is going on here due to the distressing final moments it shows, which has put a spotlight on it. It is clear that, at a minimum, if a blitz or armageddon playoff is used an increment or delay on the clock should be included to help mitigate the worst aspects of a time scramble if one happens. But unfortunately this was not the standard practice before this game and it has become clear only with the benefit of hindsight.
I have written extensively about this controversy on Chess Life Online and already addressed a lot of these issues. I have also received a lot of feedback about the need for playoffs in the first place, and the best playoff methods, and I am currently writing an in-depth article about the “theory of playoffs” for Chess Life Online which I hope Jennifer will publish in a week or two. It will include interviews with a lot of experts on the subject, and will try to present the issues coherently and to make conclusions. I invite the readers of Chessville and Chessbase to participate in that.