Schultz was left prone on the ground after copping a shoulder to the head while tackling Dockers' defender Jordan Clark in Collingwood's 15.7 (97) to 12.11 (83) win in Perth on Thursday night.
Umpires let play continue, despite even Fremantle players pointing out Schultz on the ground.
In further worrying scenes, a groggy Schultz collapsed to the turf a short time later after trying to get up and walk off the field.
By this time, Collingwood forward Jamie Elliott had taken a mark in attack, and was allowed to take his set shot as Schultz finally recovered enough to jog off the ground.
After the match, Collingwood captain Darcy Moore described how "rattled" he and his fellow players were after seeing Schultz in distress.
"We were pretty concerned at how severe he looked, how disoriented he looked," Moore told Fox Footy.
"Players on both teams thought the game should have been stopped at least for 20 seconds to let him off the ground.
"A lot of the Freo guys were getting to Lachie as well. That was our first concern, given how nasty it looked.
"He was right in front of me so I could see how much he struggled walking.
"It felt like 20 seconds - it was a set shot anyway - so it felt like it was right in that moment (to stop the play).
"It felt like out here in the moment, (when) someone is in a state like that and we're still running around chasing a footy - it didn't feel right."
In a statement on Friday, the AFL said umpires are instructed to stop play as soon as they are aware there is an injured player in the vicinity.
"In last night's match, the umpires did not see the injured player at the time, so play continued," the statement said.
"Upon review, if the umpires were aware, play would have been stopped when Daicos had possession in the centre of the ground."
Both Collingwood coach Craig McRae and Fremantle counterpart Justin Longmuir agreed that play should have been stopped.
"Ideally you could stop the game," McRae said.
"We were all just worried about his welfare, and we called for the stretcher, and our doctors were trying everything they can to sort of just get Lachie OK.
"My love and care for Lachie is paramount, and his well-being is paramount.
"We want to protect our players, and you don't like to see your players laying on the ground."
Given Schultz is a former Docker, Longmuir has a connection with the Magpies' forward.
"It would have been nice if it had been stopped," Longmuir said.
"I hope he's OK. I know he's had some concussion issues in the past, and it's never great to see anyone in those moments, let alone someone who I've worked closely with and have a lot of respect for."
"Fingers crossed he recovers well."
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