Correction: Holding called with ball carrier in endzone is an automatic safety (no replay of down) However this change would keep the holding from allowing extra time to tick off.
I don't even see the point in changing the rule. It's such a rare occurrence and it's only done when the situation is hopeless for the other team anyway.
They might look at the rule, but honestly, it's a waste of time.
I was yelling for them to take the safety at the superbowl party I attended, and very glad they did.
In terms of the flags, the refs probably knew it was pointless. As it stands, no time would have been saved and nothing extra would have been gained from it.
Whether they change the rule or not, can't say I care. I think I've seen this happen twice in the last three years so it's not like it's a common occurence.
Would suggest if holding is called in a situation like this that the safety would be awarded (of course) and that no time be allowed to tick off.