Crafting, teamwork, retcons, and the DM's role.

[Quellian-dyrae]

Okay...here's what I'd suggest at this stage.

First, you have to nip this whole matter of principle idea in the bud. Admit that mistakes were made. You assumed Player A would be cool with others controlling his character for a session and doing the crafting. Player B assumed it was a fair question to ask if Player A's character would be doing the crafting. Player A took reasonable offense to a perceived violation of agency. All of these assumptions were reasonable, and all of them were wrong. It happens. What is important now is getting the game back on track so that everyone can have fun.

As best I can tell, the session went through with no apparent downside to Player A's character aside from the expended downtime resources. Refund those, and remove the item that was crafted with them. Allow Player A to use them on something else if he wants to. Allow the rest of the team, including Player B, to make their usual input and requests as they normally would. This should still work to establish that nobody was trying to intentionally take advantage of Player A, and that normal teamwork is still in effect.

As for playing his character in the session, it happened, it was an innocent error. If he really wishes to retcon his character out of the prior session entirely, for good and ill, let him do so. Or if he's satisfied with the fact that the session resulted in more benefit than loss to his character, let it stand. The choice of whether or not to retcon the session should be irrelevant to the choice of what to do with his downtime, since they're two separate circumstances.

A discussion with the entire group should take place to establish reasonable guidelines for how to handle absent players in the future. Emphasize that it is much easier for you as DM if they can be NPC'd to some degree, but if anyone really has problems with it hash out alternatives. I agree that someone else playing absent PCs is perfectly acceptable and often a better solution than just having them vanish (and a way better solution than cancelling the session for everyone), but everyone does need to be on board with it, and there does need to be some ground rules. Things to consider include, but are not necessarily limited to:
-Is everyone okay with the DM or a different player playing their character? And who would they prefer to play them?
-What resources are allowed to be used when someone else is controlling the character?
-How much risk is the character allowed to be made to accept on behalf of the party?
-Does the character get role-played, or does it just kinda passively follow along and contribute to mechanical challenges? In the former case, you may also want to establish guidelines for just how much creative control the controller has, to make sure nobody forces a PC to act in a way its player would regard as out-of-character.
-If something does happen during a session that the player is fundamentally opposed to, what recourse is available?

I...think that should more-or-less address everyone's fundamental concerns in a reasonable and neutral manner so the game can again start moving in a positive direction. If your players still insist on threats, ultimatums, and conflict...well that suggests underlying problems that I know I'm not equipped to offer advice on, beyond "try to talk it out".