The regularly scheduled weekly interview with Hoke on the Mich football website was just released a few minutes ago and has new comments on the incident. Among other things, he comments that the medical staff said "Yeah, he can go" and that he was medically cleared to go on that play. Relevant section is below:
A. Well, number one, we would never put a quarterback who was hurt (in there). That would never happen. As far as where we're at with it, we usually don't talk about injuries and stay away from them. But this has kind of become an issue to some degree, and Shane Morris has got a leg injury, and that's why we pulled him from the game. We'll see where he's at.
On the down where Devin's helmet came off, there was a discussion about the timeout with the referee that I wanted to take to buy him back into the game. When I talked to the referee -- because he kind of came to the sideline -- and he said, 'No.' So, a couple seconds later the line judge comes up and says, 'Now, you can buy a timeout.' But by that time, Shane was already back in the football game.
(Shane) was on the bench and (senior football athletic trainer) Paul Schmidt was looking at his leg, and (reserve quarterback) Russell (Bellomy) was there. Russell is signaling in, him and the other quarterbacks. And when Shane heard his name, the medical staff said, 'Yeah, he can go.' And he went out on the field. We'd never put a kid out there who wasn't capable. He was medically cleared to go in on that play.