The only place I think it may be partially explained is in the Online section of the manual. For me, I do put penalties on weak in my online lobbies to discourage corner cutting.
Yes, the penalty system is quite flawed, but sometimes you have to take the good with the bad. Some players know that when penalties are on, they can cut inside a racer and hit them in a way that makes the penalty occur for the opponent only.
Ghost cars happen usually when penalties are on and the game detects a higher speed collision about to occur and it ghosts the offending car. I usually see it happen when a trailing racer misjudges the braking distance and instead of punting the lead car off of the track, it ghosts through it. However, lower speed collisions and punting can still occur and the game usually is not consistent about who it assigns the penalty to.
The other argument is to leave penalties off and encourage the players in the lobby to reject vote corner cutters and dirty drivers. If enough people vote (>50%), a player will be ejected from the lobby. Of course, if I see intentional dirty driving, corner cutting, or other unsportsmanlike behavior as host, I will give one warning. If they persist, I immediately kick and add them to my ban list.
The above is just my opinion though and having not fully read the manual, I can't tell you for sure how every penalty works between the weak and strong settings.
