As much as I am new to PR and the like, I feel that I have something to add to this issue that hasn't been said yet.
We know for a fact that pokemon is a battle of the minds (prediction wars, overpredicting, etc all influence the outcome of a match between two players), and hence more often than not the "smarter" player will win.
This "battle of the minds" idea brings me to the first point I'd like to adress: misclicking and certain situations when combined with the sleep clause. If we are to stay true to game mechanics (ie no "hard" sleep clause, just so we're clear), then forcing a forfeit upon sleeping a second mon seems the best course of action, as that is the way it is ingame(wifi competitive and the like).
But what about misclicks? I find the easiest--and most logical, I might add--solution is to place the blame on the player(s)' choices. By running the sleep move in the first place, he or she is knowingly accepting the fact that they might misclick in a match--potentially breaking the sleep clause. There is no "simulator" factor involved in it. Yes, shoddy (and PL I assume) CAN lag, but the root of the problem is that the player in question made the physical choice to run a sleep move. If they didn't and a misclick happened, nothing bad would occur. But as lag is a
known problem for simulators such as PL and shoddy, if you run a sleep move you run the risk of forcing yourself to forfeit. You made the decision; it's not the simulator's fault.
That's how I believe misclicks should be handled with the sleep clause; you chose to run it, you run the risk of forfeiting because of the sleep clause activating.
The OP brings up a few valid points, that I quote here:
Player A's Pokemon uses Magic Coat and reflects Sleep back.
What if Player A knew that the foe had no other option but to use a sleep move?
What if Player A did not know the foe had a sleep move?
What if Player A were choice locked/encored/out of PP on all other moves and trapped?
What if the foe had a Lum Berry/other way to circumvent sleep (e.g. Shed Skin activated)?
What if Player A knew the foe had a Lum Berry (it could have been tricked on, or found by frisk) and needed to have it deactivated for another strategy (burn it with another Pokemon)?
I find this to be the exact same situation as with the misclicks above; when you run <move that potentially breaks sleep clause>, you run the risk of forfeiting. You made the decision consciously, not anyone else, so there shouldn't be any argument over who is to blame in those situations either.
tl;dr Running <sleep move>/magic coat/etc is a risk v. reward situation; you run it, you run the risk of forfeiting if a case outlined in the OP happens.
Just my two cents.