This needs a bit of clarification. First of all, was the location plan to the correct scale? - if not, that may make the decision quashable. I suspect, though, that the error arose because the red line followed a black line on the OS plan that doesn't correspond to an actual feature. I think this is probably more common a mistake than is appreciated, and is a real risk if a survey has not been carried out (part of my standing advice to a client is to get a survey as a first step), or if an older OS plan is relied on. If the error means the application included land not in the applicant's control then presumably the wrong Certificate was submitted with the application. Technical reasons for quashing the decision aside, I think you've begun to answer your own question. The key test, for me, is whether any of the conditions become unimplementable within the reduced site area. And, if the applicant is now proposing amendments to overcome the issue, don't they need to apply for a material amendment, at which point you can then refuse the changes for the reasons you've outlined?
