I know this is a dang dead horse but you did the right thing both in DQing the shooter and going back to freshen up on the rules. As you stated, he should have never made it to the line (he was clearly not yet under your supervision). You ABSOLUTELY MUST handle you firearm in a safe manner at ALL times.
That being said, "under the supervision of a range officer" is not defined by "make ready" - any time an RO is asked to perform RO duties for a firearm related action (or any other action that requires an RO be present) and said RO agrees to do so, you are now under the direct supervision of the RO until said action is completed (i.e., gun is returned to its proper safe condition, etc). The reason this term isn't defined is because RO supervision/instruction isn't just related to a course of fire.