Interesting situation, Hoosier. I don't think the TDA has a single specific rule you can apply here, in my mind this comes down to the best interest of the game and your sense of fairness as a TD assessing all the facts at hand. These are the kind of situations "you have to be there" to make a definitive judgement but I'd probably reason it out something like this: 1) Player 1's cards have been exposed through very little fault of his own. While we could blame seat 1 for not watching player 9's stack, we could equally blame player 9 for not speaking up and telling the dealer that he is NOT all in at 1200, which he didn't do. And we can all agree the dealer has the greatest share of culpability here. So Player 1 is looking at a real injury with exposed cards. 2) Player 1 called the 1200, perhaps he would have called a larger bet if given the opportunity. SO 3) If we allow Player 9 to continue to raise here having seen Player 1s cards which were exposed by at least in part some error on 9's part we're really shafting seat 1, IMO, albeit player 9 is shafted a bit too if his right to continue betting is cut off. 4) Did Player 9 see the cards or not? I don't usually want to guess at that. If there is any remote possibility, I assume that he did, and that seems to be the case here. I certainly wouldn't take his word that he did or didn't, I'd assess the viewing angle and see if the possibility existed. Not calling him a liar, it's just an issue of protecting seat 1 here. Given that, I'm pretty sure I'd consider Seat 1's cards expsoed here, and in fact player 9 said he saw the values if not the suits;.
We don't have great options here, but IMO we have a "lowest harm" option and that's to call it all-in for 1200 and show it down. This is just my personal viewpoint as a judge, that when these situations arise, where all your options hurt someone, pick the one that does the least harm....
A second option that I might consider would be to allow 9 to reconsider his bet because his bet was improperly declared as an all-in, but I struggle with the basis for that ruling.... Similarly, you might consider allowing Seat 1 to re-consider his bet because he called an "erroneous bet" of sorts... but he did have some culpability in that he should have been following the action also and he may have pick up valuable reads on Seat 1 given all this commotion.
I just don't like the fourth option of allowing seat 9 to continue to bet, given the degree of his participation in the error that led to seat 1's exposure, and the fact that the dealer was deeply involved in the error.