Driver not banned - hell, if being illegal resulted in a driver ban in NASCAR classes, drivers would be new every week.
They way tech works in these series is this (this was 10 years ago) -- they just do a cursory safety check - visual of the car (they don't open the hood), and of the driver's safety gear - suit, helmet, roll cage, etc. It's only if you podium that they take a deeper look, or if someone protests you. So they never looked under the hood until he won the race. Technically - he was legal with the engine, except for the displacement. The rules never anticipated that engine because it was JDM. Rules specified stock displacement (1588cc), 2 valves per cylinder and the make of the engine be the same as the car. Other than displacement, he was legal. They even modified the "2T" block (serial number) for stroking so it wouldn't be obvious he had the bigger crank from the 3T in it. Once they opened the hood and saw the motor -- their response was basically -- ".....well, you're legal this week, but you won't be next week; don't bring it back.".....with "it" being the engine.