Weeks after being selected at centre for England's World Cup showdown with Wales, code-switching Burgess has left his club Bath to rejoin South Sydney Rabbitohs.
Although Burgess said his decision was for family reasons, the timing, just after England's humiliating early exit from their own World Cup, could not be worse for the Rugby Football Union (RFU) as it starts the post-mortem into what went wrong.
When Burgess joined Bath little over a year ago, the RFU trumpeted the fact that one of rugby league's biggest stars had switched codes and his rapid elevation to the England ranks suggested a long career would follow.
The 26-year-old Yorkshireman who made his name with Bradford Bulls has seen enough, however, and Woodward does not blame him for turning his back on those who welcomed him.
"I said last week that Sam Burgess is not to blame for this mess and I stand by it," Woodward, who plotted England's 2003 World Cup triumph in Australia, told the Daily Mail.
"But with his return to rugby league we've reached one of the all-time lows and most embarrassing points in English rugby history."
Woodward believes the RFU needed to take the blame for England's World Cup debacle, saying the organisation had "marched confidently into a total mess by wrongly appointing Stuart Lancaster as coach.
"The review after (the) 2011 (World Cup) was a shambles," he said.
"Players and coaches let down by media leaks, good men exposed as scapegoats and lesser men hiding and shirking responsibility. Nothing has changed.
"The panel chosen to identify (former coach) Martin Johnson's successor somehow selected Stuart Lancaster, a coach lacking any true coaching experience at any level to prepare our national team for a home World Cup.
"We are the laughing stock of not only world rugby but also sport and business."
Woodward said Burgess had been made a scapegoat after England went out of the World Cup at the group stage, even though the hosts were beating Wales until late on and only fell behind after Burgess was substituted.
"It is a real shame, but it does not surprise me," he told BBC Radio 5 live.
"He came over to rugby union and had nothing but bad press. Part of me is gutted he is going back but I can understand it. He wasn't given the time."
(Reporting by Martyn Herman, editing by Ed Osmond)
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