Gatland had already seen prop Adam Jones depart the World Cup semi-final with a calf injury, and then eight minutes later Wales captain Sam Warburton was sent off by Irish referee Alain Rolland.
Despite being reduced to 14 men for more than an hour, Wales scored the game's only try through scrum-half Mike Phillips and only lost by a point, 9-8.
Gatland, still disappointed by the referee's decision, revealed that in the wake of the red card the coaches talked about faking an injury.
"I know a lot has been spoken about the red card," Gatland said.
"In retrospect, I can understand in any game under the letter of the law there are a number of decisions referees can make.
"I just thought on that occasion, given the significance of a World Cup semi-final, to give a yellow card would have been an appropriate decision.
"That is why they are appointed as the top referees in the world, because they make the right decisions."
Gatland continued: "I will give you an example with what happened after that. We'd already lost Adam Jones, and we discussed in the (coaches) box whether we would fake an injury to one of our props and go to uncontested scrums.
"But morally, I made the decision it wasn't the right thing to do.
"We could easily have done that in the first 25-30 minutes, but in the spirit of the game, in the spirit of a World Cup semi-final, I didn't think that was the fairest or the right thing.
"That is why I honestly believe Alain Rolland made the wrong decision. Under the rules and regulations he was perfectly entitled to give a red card. But every game is different.
"You have to take the circumstances of the situation and the intent, and in that situation, given his experience and the role he was given, a yellow card was the right decision to make."
Gilbert has released a new line of rugby cleats. The Gilbert Virtuo 8S is part of the exciting new product. Check it out.
The Barbarians are one of the top invitational rugby sides with a long history and classic rugby jersey.
The Nike Tiempo is a solid rugby cleat and one of few styles still made from full-grain natural leather.
The Lions get ready for their matches with this green training jersey. It's what the players wear. Get in the Gear!
A cool looking all black rugby cleat with the high performance adidas is known for. Get in the Gear!
Wear the crest of the British and Irish Lions on your t-shirt. A great look for the summer.
The Lions are ready to get their Australia tour underway. They arrive in Perth on Monday.
The New Zealand All Blacks training jersey for 2013/14. Get in the Gear!
The USA Rugby Pro Alternate rugby jersey is perfect for any fan of the Eagles. Get yours to wear during the summer Test matches.
The NEW All Blacks 2013/14 jersey has arrived at World Rugby Shop. Dare to wear the colors of the All Blacks.