Could it be that what they did disserviced the fewest number of passengers out of the choices that they had?
Not saying that it was good (especially for the misconnected passengers), but sometimes an airline has to play musical planes when a plane breaks down or is otherwise unavailable for a scheduled flight. I've seen worse (2+ hour delays on UA, huge lines of misconnected UA passengers at UA's ORD customer service desk).
This sums up what I was trying to say better than I said it. There was no good option here - Southwest chose the best plan for everyone (or more passengers than not) out of a bad set of circumstances.