For what its worth in addition to what you've said...I would hazard to say that the waterlogging suffocated the roots, they died and the fungus is secondary to that. With the green still evident higher up the stem, the phloem up there is still transporting what was left of the food from the leaves...but the dead roots and lower trunk compromised water getting up...dead tree.
Some people would do that scrape and say...'oh the tree is still alive, let's give it some more time and see if it recovers', you did a great job in highlighting the wet soil and the dead fungus ridden bark below, making it clear that we have to look at all parts of the tree and all conditions, not just stop at the first obvious one.
It would seem the waterlogging is the issue, the fungus is opportunistic...what d'ya think?
I often tell people trees rarely die from just one cause, more likely a combination of things, again you highlighted wet soil on its own is not necessarily a problem, but combined with being planted too deep, well, there you go.
Nice job!