You're right, it's not typical. Typical speech for those matters refer to someone's future presence in a present tense. The only way that could be logical is that the reference is to someone on the roster. I know, I also ran track myself (actually field events). I was always "in" the discus event and "in" the poll vault event, though they would often occur at the same time, so I would have to choose between them and never actually be in one of them. (I know I know, only one race can occur at a time, but you also see this when runners are rostered to participate in field events).
Either way, all that argument does is reinforce that 1st and 2nd could not have been participating in the race when the OP was stated. If you view the word "in" as someone on the roster, then the OP is impossible (same as if 1st and 2nd hadn't run at all, or if 1st and 2nd had dropped out mid-race). Leaving you with the only relevant definition of "in" which is "participating" or "currently and actively engaged in the race".
The logic wasn't flawed, but the context that most people assumed was that the word "in" meant on the roster, which is obviously impossible given the guidelines of the OP.