... I would first ask the SB to make a decision to either call or fold. If the SB chooses to make the call, then to compensate for the house error, perhaps I would use Rule #1 to give the BB a choice to alter the bet to either a min-raise or to leave it as all-in.
If you give the BB that option, it must be before you ask the SB his decision.
I disagree Dave. Here is my reasoning. I'm assuming that the following is true.
When the dealer made the mistake by saying "Call, showdown please" neither the SB or the BB had done anything wrong. Then, the BB followed the dealer's direction and revealed his hand. At that time, the SB and others pointed out that the SB had not yet acted on the all-in raise.
Assuming this to be true, here is my reasoning.
The SB is facing an all-in raise and it is their turn to act. My ruling would require the SB to declare either fold or call at this point. If the SB folds, the BB wins this hand and we proceed to the next hand. Only if the SB decides to call the all-in bet would I consider invoking Rule #1 (fairness) to offer the BB an option to keep the bet as all-in or reduce it to a min-raise. If the BB keeps it as all-in we proceed to showdown. If the BB reduces it to a min-raise then we deal the flop and the SB acts first.
It makes no sense to offer the BB an option if the SB wants to fold to the all-in bet. If the SB is defending their right to act on the BB all-in bet, it is most likely to fold. On the other hand, now that BB hand has been exposed, the SB might be quite willing to make a call if they also know that the bet is being reduced to a min-raise. In other words, the ruling would be an attempt to minimize the adverse impact on the BB due to the dealer's error. Offering the option to the BB before the SB has made the call does not accomplish that objective. IMO, that offer would be the second house mistake in this hand.
Of course, there is no perfect solution to the problem as the hand has been exposed due to the dealers error. The SB will certainly call if they have a better hand and might bluff with the second best hand. But, given the OP, I expect the SB is planning to fold.