We all sympathize.
If it wasn't for the interfacing and the different thread catching, etc. issues, I'd leave it as is. But since this is a memory quilt and is for someone else, yeah... you have to do something.
Label is good, applique is good, taking out and redoing is pretty awful but is good in the end.
My story of such a thing was a storm at sea quilt, all different pieces of blue. I don't know how many times I handled each block, dozens I'm sure as I pinned and sewed and pressed and quilted and bound... But I didn't notice one of the larger squares of fabric was inside out until it was hanging in a show. No one else ever commented on it and I left it as it was despite my desire to do something with it. It is indeed a humility block, I've never ever had to put in a deliberate mistake to any of my projects, there's always something that gets in and that I have to deal with in one way or another.