The director did not create a problem, the players at the table did.
I cannot help but think there's more to this story then we've heard here. For one thing, many places consider 10% of a top a sufficient PP for a first offense. In fact, the ACBL is the only one which has a higher "standard penalty" (that's in quotes because in fact the size of a PP is at TD discretion everywhere, so far as I know) and even here it's 25%. OTOH, willful disobedience of a director's instruction may very well rate a higher PP, particularly if you argue with him.
I don't think I have or would ever ask a player to move boards when I can do it myself. But I can certainly envision situations where I have something else I need to do, and both that something else and the movement of the boards need to happen quickly. If I asked a player to move the boards in that situation, even if he wasn't North, and was dummy, I would certainly issue a PP if he refused, and if he argued, well, the PP would keep growing until he stopped arguing.
The dummy's "right" to observe the play does not trump a director's instructions.
As a director, I provide a service. I am not the players' employee. If I am anyone's employee, it's the club owner. In some places, where clubs are membership organizations, perhaps it's different, but it's certainly not universal that "the TD is the players' employee". And even if he is, both he and the players are bound by the rules. Maddog Probst, who was a director at the Young Chelsea in London used to get into disagreements with the club management from time to time. If he felt what the club wanted him to do wasn't right, and he couldn't talk them out of it, he'd quit. They'd always rehire him, sooner or later.
If you think the director in your local club is stupid, don't play there as long as he's directing.
I think that Fluffy's point on appropriateness is that now that the
International Bridge Laws Forum has joined the Bridge Base Forums, that's a better place to post questions like this than is this forum. I'm a moderator in the IBLF, but not here, or I'd move the thread myself.