1. Yes
2. Yes, has to properly start

Two separate issues 
1. She was OCS - did she return and restart - yes
2. She hit the start mark while racing and needs to take a one turn penalty that complies with R44.2 
If she could have tacked at P8, but delayed that tack as it would have meant she could not cross the start line without additional maneuvering, she fails to meet the test of 'promptly'. So she had not complied with the conditions of R44.2

I submitted a similar hypothetical case to the Canadian Appeals Committee in 2012. Summarising their answer, they said that a penalty turn does not have to be a perfect circle - a boat is allowed to maintain steerage in order to maneuver, but a delay for other reasons, fails that test of 'promptly'.

John

Generally agree with John B.

Case 108 helps a bit

When taking a penalty after touching a mark, a boat need not complete a full 360° turn, and she may take her penalty while simultaneously rounding the mark. Her turn to round the mark will serve as her penalty if it includes a tack and a gybe, if it is carried out promptly after she is no longer touching the mark and is well clear of other boats, and when no question of advantage arises.

I wouldn't be worried about the little jink to get around the mark @9, but the boat then beam reaches on for another 3 boat lengths before going into her tack.  That's too big of an interruption.

That is, of course, if anybody bothers to protest.

Note that if the touch is at the finishing pin, things are a bit different because of the definition of finish.

Finish

A boat finishes when, after starting, any part of her hull crosses the finishing line from the course side. However, she has not finished if after crossing the finishing line she

My question to Yellow would be:
Was there anything that prevented you from completing your penalty turn at position 8?
If the answer is NO, then she did not satisfied the RRS 44.2.
If the answer is YES, then she most likely had issue with the first part of the rule 44.2 'After getting well clear......'
Look at the position yellow ends up at. Had she completed her turn as per rule 44.2 at position 8, she would never be in the 'desired' position, having some control over blue.
On the OCS, when she starts, she is OK.
Kim

Is Blue in position 1-4 or 10-13? i.e., is Yellow dodging Blue?

Kym, and Phil (I think I know where you are going)

I don't think 'well clear' should be interpreted to mean  'so well clear that she does not thereafter need to take any action to keep clear of other boats'.  If that were the case rule 21.2 would have no work to do.

In the diagram, even if Blue @1 corresponded to Yellow @9, and Y bore away to keep clear of B, I wouldn't have a problem with that, if Y hardened up and tacked promptly after passing astern of B.  She doesn't do that, she stands on considerably further, which interrupts the penalty turn.

John, agreed.
A penalty turn no longer has to be a 360 degree turn. And it NEVER had to be a tight circle.
A gybe, followed by a close reach long enough to gain momentum to complete the required tack is quite appropriate.

Hi friends.
I agree with Mr. John Ball
I think she had not complied with the conditions of R44.2.
She could have tacked at P8 to finish the penalty PROMPTLY

Cheers !!!