Player 1 (SB) 50.00
Player 2 (BB) 100.00
Player 3 raises 200.00
Player 4 (me) goes all-in for 150.00.
Players 1 and 2 fold.
Here's my question. The dealer determined that the most I could will was 150.00, because that was all I had. So the dealer had player 3 take back his 200.00 raise and had a showdown between he and I. It didn't seem right that player 3 got to play for free. I challenged it and was told I was wrong.
What is the rule on this?