Dispute over Holdem Rules- blinds, new players, and other BS

[bigslikk]

Okay so I think I'm right. There was just some heated dispute the other night (at a home game, duh) over specific Hold'em rules. I'm not too confident about my position (last night I was sure and cocky as hell lol), so I've posted.

Just as a note, the funny thing about our table is that we break "official" rules all the time:
-if a hole card is dealt faceup, our method is "do you want to keep it or take a new one?" always funny when villain keeps it... faceup...
-pre-burned, pre-dealt, pre-heated flops (I don't do this)
-worst table-talk imaginable where everyone reveals what they had, and "would've had" and an all-in call almost always involves a six-man "think tank" versus the villain pusher.
'
At the same time, our table pretends that we're playing at the WSOP main event in the Bellagio... for our lives. People get bitchy about:

-not dealing to the small blind first. Say you're in the cutoff dealing for someone who's in the can, you can't naturally deal the button first (your immediate left), because then the small blind wouldn't get the Hole Cards that Fate hath Appointed him.
*even funnier, you're in the SB dealing for someone, and they insist you deal yourself first (good thing I put this ace on the top...)

-string betting. Don't try double fisting any bets, if your right hand moves chips in a millisecond after your left expect someone with a marginal / drawing hand to call you on a string bet.

-tons of bs on straddling. One can straddle the BB (double it from UTG) and acquire preflop position, but a double or triple "donk" straddle (8BBs in the dark from UTG+2) do not acquire position. Yup we're playing for dimes and quarters but we're at the Bellagio.

Back to the situation at hand:
Some guy busts out, waits out a few hands, and decides to buy back in. Conventional rules would force him to put in an entry blind (SB + BB) but we've never asked that and no one really cares anyhow (ironic).

He buys back on the button.

Now tell me which the following procedures is correct, or if both are correct, which one is more conventional / common:

1. The Big Blind and the Small Blind from last hand are the Big Blind and Small Blind again. They both pay their blinds a second time. Play continues.

2. The Button skips the new player, the Blinds move so now UTG is the BB, and BB becomes the SB. New player plays as the cutoff. Shuffle up and deal.

Tipoff to which scenario I argued for: I was the previous hand's big blind. Villain for argument? UTG who else lol?

I know this argument over a blind is stupid and senseless but those two words are actually apt descriptors of many events at our table. Was I right? UTG assured me that a casino allowed him to buyin (with entry blinds) on the button and the blinds would pay twice (one hand after the other). wtf...? Who was right?

[Warpe]

2.

[overflow]

2.

Blinds move, rebuying player gets the cutoff, previous small blind gets the button, previous big blind is in the small blind, and the previous UTG is now the big blind.

Whether or not you want to make him post is up to your "house rules". But in general it is usually not correct to allow a player to see "Free Hands" from the cutoff down to UTG without posting dead blinds once.