Based on his scenario - run is earned - assuming R3 reached there without the aid of an error but by some combination of BB, HBP, Stolen Base or base hit. If he was there due to an error that put him on base then run is unearned.
Infield fly allows runners to advance at their own risk. Defender chose to make a play on R1 thus making it a fielders choice. You could have had an error if he threw the ball away or other miscue allowed runners to advance to bases they would not have had if error had not occurred.
Also concur umpire blew call and if coach did not protest game - he should have. He would have won if needed.