Speaking to the officials that were on this game about this play - they said they let the play go and you lost 3 yards because it is a live ball penalty. Then since you didn't get the first down on the play, the penalty was automatically declined and it would then be a turnover on downs.
If you have film that shows different please sent to bkelleyok@gmail but I am just saying it was a pretty veteran crew that knows what to do on a illegal motion penalty. Not that we can't all make a mistake from time to time, this would just be an odd one