UEFA's statement after the game says this on the second decision in the Schalke match:
The second decision was also correctly made on the basis of the Laws of the Game (Law 11 – Offside) which stipulates: “if a player in an offside position is moving towards the ball with the intention of playing the ball and is fouled before playing or attempting to play the ball, or challenging an opponent for the ball, the foul is penalised as it has occurred before the offside offence”.
Who else believes this rule seems unfair? If a player is offside once the ball is played and starts to move towards the ball then he should be offside. It basically means you can gain an advantage by being offside as you can get yourself in a dangerous position and then hope you're fouled before the ball gets near to you and win a penalty, which is exactly what happened last night.
The part you've quoted is a bit of a mindfeck.
"[P]layer in an offside position is moving towards the ball with the intention of playing the ball" can be fouled because he hasn't played or attempted to play the ball. Isn't "moving towards the ball with the intention of playing it" an offside then? That suggests that there is a line or a difference between "moving towards the ball with the intention of playing the ball" and "attempting to play the ball" that defines the actual offside offence. Where does that line go? In my mind, but apparently not in FIFAs, moving towards the ball with the intention of playing it, would make the player "actively participating" and therefore offside already, thus not being able to receive a foul because his offence occurs when he runs towards the ball.
So if you're standing ten yards offside and you're running towards the ball, then all opponents will stop, right? Can you then just shepherd the ball while indicating that you're not attempting to play it, while a teammate runs in from deep? In that situation the guy shepherding the ball for his teammate would only become offside if an opponent got close to him because then he'd be "challenging an opponent for the ball" of "interfering with an opponent"?