New Zealand's under-23 side were expelled just hours before Sunday's final against Fiji, who went on to beat Vanuatu to advance as Oceania's representative at next year's Rio Games.
After losing 2-0 to New Zealand in the semi-finals, Vanuatu lodged a protest against the eligibility of South African-born defender Deklan Wynne with the OFC Disciplinary Committee.
The committee deemed Wynne, who moved to New Zealand as a child with his family, was ineligible and awarded the game to Vanuatu 2-0 instead.
NZF reacted angrily to the decision and were aghast the OFC had not told them of the outcome until just hours before the final.
They also said they had been led to believe that world governing body FIFA would be making a determination on the outcome of Vanuatu's appeal.
NZF Chief Executive Andy Martin said in a statement on Monday their lawyers were preparing an appeal to the OFC.
The statement added that NZF had liaised with the OFC and the organisers of the Pacific Games, which was hosting the Olympic qualifying tournament, on the eligibility of all members of its squad.
"New Zealand Football has acted in good faith at all times and we would have expected any issues on player eligibility to have been raised in advance, through the process we were given, so that they could have been dealt with properly in a timely fashion," Martin said.
Wynne was deemed ineligible under Article 7 of FIFA's statutes which relate to a player acquiring a new nationality.
Under the article, the player, a parent or grandparent must have been born in the country they wish to represent.
If they are ineligible under the first three criteria, they can qualify if they have lived in the country for five years continuously since the age of 18, making the 20-year-old Wynne too young to qualify under that clause.
(Reporting by Greg Stutchbury; Editing by Peter Rutherford)
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