I've always thought that people find these rules rather harsh because it does not apply to only the winning photos, but rather they have the rights to use ALL photos that are entered for these competitions?
Most times its.
eg:
# agrees that ... may, at any time whether during or after the competition, reproduce, distribute or publish their photo image(s) submitted for the competition whether for promotional or any purpose whatsoever in either electronic or print format and whether online or in any media including but not limited to exhibitions, galleries of any description or any publication, without payment or compensation to the participants.
# shall grant to ... a non-exclusive, sub-licensable and perpetual licence to use, reproduce or modify in any way which ... deems fit all the images submitted in the competition, without ... having to pay any royalty, fee or charge whatsoever therefore.