The 1830 compositor underlined Law in pencil (on line 35 of page 51 in 𝓟), which appears to be an indication that he considered this word to be problematic. But he did not directly specify what was wrong with the word, and the 1830 edition has law. On the next page of the printer’s manuscript (page 52, line 13), the word Lord in 2 Nephi 3:2 was also underlined in pencil by the 1830 compositor (“& may the Lord consecrate also unto thee this land”). Again there is no corresponding change for this word in the 1830 edition. But it appears that the editors for the 1908 RLDS edition interpreted these two underlinings as having some connection with each other and decided that the underlined word Law on page 51 of 𝓟 should be changed to Lord.
The original manuscript is not extant here. When we look at the rest of the Book of Mormon text, we discover that there are no occurrences of the phrase “punishment of the Lord”, but there are none of “punishment of the law” either. Even so, there are passages that show a close juxtaposition of law and punishment, including the following that pertain to God’s law:
So there is really nothing conceptually wrong with the phrase “punishment of the law”, and there is no reason to accept any emendation to the word law in 2 Nephi 2:26, especially given that Lehi’s whole discourse in 2 Nephi 2 is on the necessity of law in God’s plan.
There is one other place nearby where the 1830 compositor underlined a word: namely, me on line 31 on page 55 in 𝓟, and again without any explanation:
But in this instance, the 1830 compositor made a change when he typeset this word. He set the me as men, thus confirming that underlining means some kind of change. For further discussion of this example (and why men is incorrect), see 2 Nephi 4:26.
Summary: Maintain the reading of the printer’s manuscript (“punishment of the law”) since it makes perfectly good sense, especially in the context of Lehi’s discourse on the necessity of the law; the 1830 compositor underlined the word Law in 𝓟, which the editors for the 1908 RLDS edition apparently interpreted as meaning that Law should be emended to Lord.