My personal view:

1.) Nobody here tells anyone else what to do, you can always make your own decisions, it's a free country. The idea is to make INFORMED decisions and not go blindly down the path. I would have to say that about 1/3 of my entertainment law practice is made up of artists who weren't really paying attention at some point in their careers, who then have to seek my assistance to try to fix problems that could easily have been avoided (a very expensive process,I might add). It's fine if you want to give away your work, but if you do, don't count on the Courts to find loopholes later when that one song starts to produce income for somebody else and you have to sit on the sidelines and watch that somebody else making all the money from your sweat and effort. If you're really that secure in the fact that you won't care what happens in the future, then by all means, go ahead, make your free choice, and give it away, but you'd better be sure you won't have any regrets(By the way, those who claim they are solely in it for the publicity will note that there is nothing in the quoted rules to say that they even have to give you credit for being the author when they use the song).

2.) As long as authors are willing to give it up for free and enter contests with the kinds of rules being discussed in these posts, there will be no incentive for the contest companies to change their approach. We're all in this together, and we collectively get what we collectively deserve.