Unfortunately NEXUS and GE are "letter of the law" programs - you need to follow every dotted I and crossed T in order to remain in the program. I think this case is worthy of appeal, but in general, these programs are setup according to zero-tolerance standards.
Which is why it drives me nuts that these programs are being suggested as the basis for TSA's new TT program.
No way in hell am I giving over iris scans to the Feds, but that's another thread... (I'd search and link but just got home from a six-hour flight delay at FLL...more tomorrow)