Penalties would surely go away. It's worded to have an out for situations that may complicate things like trades. Also they can still lose draft position because if they didn't illegally tank I could see they likely finish something like 4th last instead of 2nd last. In that case I'd reverse all penalties I could and have them pick in the 4th spot each round instead of the 2nd. It's not about punishing them but about protecting the other players that got affected from the guy that left.
You can still use fleaflicker. It makes it easier, but once the draft officially starts it is expected all trades happen through me here.
I may ask for you to immediately post it on Fleaflicker but it's mainly so that once picks move there isn't an issue with discrepancies.