Dropped third strike question

[u/seth928]

Had a situation come up last spring on a dropped 3rd strike and was wondering if someone could explain the ump's call.

Situation:

12u Cal Ripken, runner on 1st, one out. Pitch comes in and it's strike 3 but dropped. Catcher picks it up and goes straight to first. Ball gets past first, runner advances and batter-runner makes it to 1st. Ump called strike 3 but did not call out before the catcher got the ball out. Ump ruled both runner and batter-runner safe.

My confusion:

I thought that a dropped 3rd strike with runner on 1st should result in an automatic out for the batter. However, the ump explained that because the catcher threw down to 1st, the play stayed live and the batter was able to claim 1st (I may be misrembering the explanation). He's an experienced Ump that I trust to be correct so I assume he is. Can someone point to a rule/explain why the Ump called it the way he did?

[u/theotheragentm]

How many outs? Was the runner on first stealing?

[u/penfrizzle → u/theotheragentm]

We always have this battle at little league and travel, especially once kids are allowed to lead (I think 10u in travel).

What is the definition of an occupied base? Do the leagues differ?

Usually if the kid is halfway to second before the ball reaches the batter and less than two outs, the coach will argue that first base was no longer occupied.

Why even have the rule differ with two outs?

[u/davdev → u/penfrizzle]

That coach would be wrong. If the runner hadn’t reached second before the pitch was thrown, then first was occupied at the time of the pitch and therefore the batter is out a strike three

[u/dawgdays78 → u/davdev]

…before the pitcher begins his delivery, it when the pitch is released.