Dude, it has nothing to do with him cheating.
It has more to do with the fact that he called pg a "weenis" years ago, and openly criticizes YC and SV culture in general.
The rejection was basically "sry, but you aren't quite the culture fit we're looking for". Which is fine, YCF can fund whomever they want, it's their money and their prerogative.
But here's the rub.
The way I see it, the biggest irony of the whole experiment is that it was probably meant to draw non-traditional founders, because of the pseudonymous nature of HN. But in the end, biases still prevailed. Which is why hiring/funding in SV is beyond broken, as this experiment has proven empirically.
This thread is the embodiment of all the diversity problems that tech has, the root node if you will. When the decision comes down to arbitrary "gut feeling" vs. the best (candidate|founder), then you know there's a problem.
If you can't see that, then...I'm not exactly sure what to tell you. Spend more time in the Valley?
