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Usually I would agree that "do-overs" are strictly for the playground. However, for something like ice dancing, I don't mind so much. Partly because I only grudgingly accept ice skating as a sport, probably. Also, though, because maybe if there wasn't such a rule in ice skating, people might not even try to do something like the quad-whatever. Why risk everything on something no one has ever done before, no? Nobody would hold it against them that they didn't try, because no one else had ever done it either.
In sports where people compete directly, face-to-face against one another, mulligans wouldn't be fair. One football team's failure to get a first down on a reverse is the result of the other team's defensive play. In the instant matter, it wasn't a crafty Russian zone blitz that spoiled the Chinese pair's landing. The Chinese just tried something apparently really really hard and fell.
If the Chinese had taken a spill performing a simple maneuver, then perhaps the mulligan would be inappropriate. The Chinese, however, were attempting something very difficult and rare. Therefore, I support the rule as applied here.