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Don't see what's wrong with 'Ma'am'. It's just a contextual courtesy. When I stand to speak in Council, if it's the deputy mayor presiding I address her as 'Madam Deputy Mayor'.
Just one of those things. As long as there are no hierarchical implications of 'Ma'am' versus 'Sir', then it really doesn't matter. It certainly doesn't matter enough to do that to someone. That's a total abuse of her power and position. Trying to humiliate someone and take them to task in such a public way is appalling. That kind of response should be reserved for the most incorrigible and the most unwilling to change.
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