should I pull that cap off the pin 12 (latch) line???
Yes most defiantly.
When a cap is discharged it presents a short circuit load. This causes current to flow in excess of the current limit for the pin. The same occurs when going from a HIGH to a LOW.
We take precautions on the gate of an FET with a series resistor for capacitance several orders of magnitude smaller, so it is a bit silly to not to do this on the whopping big capacitor.
Basically it was a classic beginners mistake by Tom who wrote it. He experienced intermittent operation that looked like jitter on the latch so he wapped on a capacitor and it fixed it.
However, in reality what he was doing was providing parasitic supply decoupling through the output pin. That is why it seemed to cure the problem. If he had applied some read decoupling ( cap across the power pins ) then there would have been no problem.
Unfortunately for what ever reason this has not been corrected. So yes remove it, it's an arduino killer.