Anyone figure out the answer?

The reason the stewards didn't place #1 behind the #3 is because the #3
faded badly in the stretch. Faded enough that it is doubtful the incident
cost him a better placing. The #2, on the other hand, only was beaten a
head, so it *could* be argued the incident cost him the win.

That is the only explanation that makes sense, but it is setting a very tricky precedent.

That precedent has long been set. From the NY rule posted by You.

(b) A horse crossing another may be disqualified, if in the judgment of the stewards, it interferes with, impedes or intimidates another horse, or the foul altered the finish of the race, regardless of whether the foul was accidental, willful, or the result of careless riding.

In regards to the #3 vs #1, the "crossing another" didn't "alter the finish". Notice in the stewards explanation you posted the justification for placing the #1 behind the #2 was that "the initial action of #1 Awesome Merger altered the finish of the race." This shows the operable language was "altered the finish of the race.

has to change
 

Although I'm upset with the DQ which cost me a lot of money, I'm still upset with the call that put the 1 horse behind the 2 and not the 3 horse that he supposedly bothered; I DONT CARE IF THE 3 HORSE WAS FINISHED OR NOT___IF HE BOTHERED THE 3 WHO IN TURN BOTHERED THE 2 THEN HE SHOULD BE PLACED BEHIND THE 3; END OF DISCUSSION

My point was the bump was pretty severe. The 3 may very well have not been finished.