Aw. I'm sorry your DC's little classmate appears to be struggling. I agree; it really complicates matters when this specific acceleration appears to have been in response to the needs of a different person. Mostly for the student in question, but also, as spaghetti notes, for anyone else down the road who might be considered for acceleration.
This doesn't mean it was necessarily inappropriate in terms of absolute cognitive or academic level, but it may be that it is currently out of reach for the little friend in terms of "doing school" ancillary skills, since it sounds like the student went straight from a (likely) play-based preschool into a traditional academic first grade. That's a big jump for a child who doesn't have the strength and/or motor skills to manage a backpack. (Note: we did exactly the same transition with one of ours, who was just a couple of months older than this one at the time. But that's the kid in our house who's had the best fine motor and social skills of all of ours at every stage of development.)
I know you're not asking for advice, just venting...but FWIW, it seems to me possible that those soft skills will catch up into the functional range over the next year or two, just with natural development and practice, and that as long as the school is willing to scaffold for them in the interim, the long-term outcomes have a decent chance of being positive. And if this year doesn't look like it's on that trajectory, then maybe the school looks into placement into that 1/2 split next year, with the option of turning that into a grade 1 retention year if need be, or of putting it on the books as grade 2, if the necessary skills click into place sometime during the year.
This is, of course, assuming that acceleration was actually academically appropriate, and that it's just soft skills and asynchronies that are getting in the way right now. It is still possible that it really wasn't appropriate to begin with.
On another note, I am happy to hear how well your "baby" is doing!
