I'm a long time commish who has faced numerous tough issues and my advice to you is to follow your rules. Do not let emotion get in the way of your carrying out your duties. Your responsibility, first and foremost, is to the league as a whole. It's your job to protect the integrity of the league and govern it by the rules agreed upon. This isn't a grey area. This is a simple missing of a deadline by an owner. There is only one person who is responsible for getting their line up set and it's the owner of that team. Justice is blind and so must you be in carrying out the duties of commissioner. Especially if there is a $150.00 buy-in. If you stray from the rules you will tarnish the commissionership and lose the respect of some of your owners. It may not happen immediately but it will happen. It will come back to haunt you.
First, you will be alterring the entire league, not just one game. Making line up changes in this case could change the outcome of a game and would certainly change the overall point total for that one team for the year. What happens if either of those issues comes back to cost someone a playoff spot? How does the guy who loses out feel since this person missed the deadline and still got points which then costs them in the end?
Second, it's not like you have to wait til 11:00 a.m. on Sunday to set your line up. This owner waited that long and it was a personal choice. It's nobody's responsibility but that single owner to get their line up in.
Three, what will happen the next time this comes up only with ill intentions? Each league has at least one owner who doesn't care how they win. What happens the next time someone misses a deadline and they come to you asking you to make changes based on their word? You will have taken the word of an owner in the past so you will be expected to take the owner's word again. It will be precident. Even if the right thing to do is to say no to that owner, they will feel screwed because you took another owner's word in the past so why not take their word now?
So, my strong advice is to follow your league rules. It's not your fault. People have to be accountable for their actions. It's unfortunate that this happened but the responsibility falls on one owner. Every owner can point to a mistake during the season. Just this week I missed a roster deadline in a league I'm in and had to play without a PK. It was my own fault. Nobody else's. I played one short (still won though...!!YES!). Point is, it's each owner's responsibility to run their own team. Screw with that rule and you screw up your entire league and hurt the ability of the commissioner to lead in the future. Don't go down that road. And don't ask the opposing owner if he minds. That's a horrible position to put that owner in and it's not fair to him. You make the ruling.