This one is worth answering directly, because you and the app agree and it wasn't letting you see that.

The rule 14 card only ever proposes one move — you hold your course — and asks whether holding it is legal. So on a card where the answer is "that's a foul", the app is saying exactly what you were saying: swift and decisive action was required and holding on wasn't good enough. It just never gave you the words for it, and it never told you that contact was actually coming, which left "surely she'll get out of the way" as a perfectly reasonable read of the picture.

The card now says so in the setup: she is not keeping clear, and you are going to hit her. What's left to judge is the rules question — rule 14's first sentence binds both boats all the time, so the interesting half is the second: a right-of-way boat need not act until it is clear the other one isn't keeping clear. When that stops being true is a real question, and it's the one the card is trying to ask.

We've been talking about accuracy a bit here and what a PC might want to be aware of.   I also mentioned that many people are writing new Vakaros visualization tools (and a PC should understand the settings of the tool being used).  Below is an opportunity to examine both these ideas.

One moment where we can assess that accuracy is when boats contact each other and leave visible damage.  Below is such an instance. This image comes from a screenshot from a new Vakaros viewing tool called mastabeam (Mastabeam.com). 

This is at a windward mark and the conditions were such that Green was heeled over with her rail close to the water.  As you can see, Pink's bow is overlayed on top of Green's rail.  That is a very precise representation of what actually occurred based on the evidence left behind.   

The collision occurred precisely there along Green's port side and down below Pink's bow peak such that her bow overlapped Green's rail.  

I've invited Kevin, the creator of MastaBeam to join this thread to offer insights he might have regarding Vakaros visualization in the context of PC hearings, since he's been working with these data streams. 

Clearly placed there by a trimmer trying to share the guilt! ;0))

Thanks very much John. I appreciate your efforts in replying in so much detail.

Our annual program includes a Pointscore Series (Pursuit format; scratch -> biased towards slower boats) run every fortnight ( 15 races per season), Championship (Yardsticks; 2 races each day; 14 per season) and Sprints (Yardstick, 3-5 races per day; 24 say races per season) => run in turn every other week.  (so C-P-S-P each month).
 
We'll be running our annual October Regatta (6 Divisions) , Hobie States, Spiral Nationals + the International Canoe World Titles this year so we'll be busy, and having lots of fun and enjoyable times out on the Bay!

As Race Secretary I want to apply a common entrant list and a common set of rules for our club races. (KISS).  We are transitioning from a Cox-Sprague system to low-point (Sailres) next season. We have a meeting next week to decide on the rules.

After much research and simulations and yours, and others kind feedback, my preferred approach is DNC= Starters+4. I thinks the committee could settle on DNC = [12] which is starters + 4 for our average fleet size of 8-10. There is a group who want to keep the regatta approach of Entrants + 1.
 
We'll see who 'wins' the debate. Interesting Times (pun intended)! 

Cheers and Thanks again for all the great feedback. 
PS many clubs face similar issues and so it is worth discussing it here.

Looks like several scoring systems allow for it.  You will find the instructions for how to do it on RacingRulesOfSailing.org here.