I disappointed that you decided to stay out of it. The irony is, as a Paramedic, you WOULD have been the first First Responder on the scene when he spazzed out and plowed the thing into some kid on the monkey bars trying to film his grandkids.
I take a much more "drone police" view to this, and am not popular here for this view. I don't care. Human beings are far more important than someone's hobby.
Under the circumstances you've described, I would have told him in a friendly way that the FAA rules prohibit him from flying over the people in the park. It's that simple.
If he ignored my advice, I'd escalate to threatening to call the police. If he took off anyway, I'd record the whole thing with my cell phone. If he did fly over the people in the park, I'd carry through on my threat, and call the police.
But that's it. My "drone police" behavior is narrowly limited to one, and only one thing: Violating the rule flying over people.