It is referred to as botched because it actually was - NASDAQ actually broke during the initial day of trading. Initial start of trading was delayed, then trades went through didn't get confirmed for -hours-, which is something of a disaster. This isn't some figurative use of the term, nasdaq actually failed in the objective sense.
You're forgetting the part where NASDAQ told every major player to sell the Facebook shares they had, if they wanted to get in on some of that 40 million in compensations (you had to fill in the sold-at price on the form, or forget about it).
It's not clear what you're saying, or why it's bad. If you're saying that traders need to have sold shares to get compensation, well, should NASDAQ just compensate everyone who says they didn't sell shares but were planning to, cross their heart and hope to die?
If you are arguing that you were damaged specifically because of technical glitches associated with the IPO, you are expected to sell the shares. Any price action after that is due to factors outside of NASDAQ's direct control, and there's a sense in which you are taking risk by continuing to hold.
(Otherwise, everyone would sue whenever a stock price moved -- shareholders complaining when prices fall and short parties complaining when prices rise)
Many solutions available are better than the one that NASDAQ implemented. For example, they could halt trading when they realize their matching engine doesn't work.
NASDAQ's chief basically saying his company sucked: http://www.bloomberg.com/news/2012-05-20/nasdaq-ceo-says-poo...