But it is legal to have your arm by your body and then push off after contact. What is illegal is "striking" your opponent, which I have always taken, and always seen refereed, as proactively moving your arm to initiate the contact.
Which is what happened, on the videos you can see his arm is up protecting the ball, the initial impact of the tackle beds his arm back towards the ball before he straightens his arm and fends him off. For me it was worth checking but was not a penalty, particularly as the rules round the TMO are that only "clear and obvious" errors get over turned.
The arm did ride up, so worth checking, but it started very low and once you are in a tackle it is a very dynamic situation so super harsh to penalise him, particularly as he was not penalised originally.