One thing that bothers me is that you said:
"I think if they sell them for nothing they should pull the papers. If they pay a pet price that is what they sould get. "
I know one thing for certain. If I ever went to a sale and bid on a registered horse and got the bid and the horse, if and when I went to pay for it and the seller "pulled the papers" because they thought they had sold the horse too low and it should have been a pet only, I would NEVER, EVER buy from that sale or that seller ever again. Once you put a registered horse in a sale, no matter what you agree to sell it for, once the gavel hits the dock, that horse is sold-with the papers it was consigned with like it or not. You can do that kind of thing for private sales at home but don't ever try that at a cataloged auction. Not sure if you understand that or not but you seem to think that is an okay thing to do.