Coho,
great question... I think the right and legal thing to do would be to revive it and send it on its way. Havesting a snagged fish is illegal, but being a hatchery fish that is there for harvest, there may be a moral justification to harvest it. But I think that the legal outweighs the moral in this case. I personally would not keep a snagged fish, hatchery or otherwise. It's all about satisfaction and feeling good about myself, I do not get the same satifaction of reeling in a snagged fish and I could never bonk one. He didn't deserve to die. the best thing that could be done would be to try to convince the other guy to release it. It's hard to say exactly what I would've done, but, I think I would've tried to release it. and If he did insist on keeping it, make him feel guilty about it.