Did the rules stipulate that the brewery had to produce cask ale year round? If brewers who don't normally produce cask ale were prepared to make a festival edition this should, in my view, have been accepted.
Camra are of course free to make their own rules and I'm all in favour of a bit of pressure in favour of conditioned beer. I understand the point about the economics of cask beer in a pub environment, but there is no excuse for the number of microbreweries selling filtererd pasteurised bottled ale.