What do you do?
Judges, feel free to discuss this scenario on Judge Apps!
[expand title=Answer]This is indeed an example of DEC, and by the new IPG, you should ask Arnold to reveal his hand to Naomi, and she should choose a card from it to be shuffled in an unknown part of Arnold’s library.
The action of Scry 1 was performed, incorrectly; once we fix the DEC, we aren’t going to back up and Scry again. (Doing so could create an advantage for Arnold.)
Arnold will receive a Warning for Drawing Extra Cards. Naomi should not receive a Warning for FtMGS, because she did not have reasonable time to point out the mistake or prevent Arnold from making it. [/expand]