I may not have a lot of bonsai experience and I don't know the protocols of bonsai judging at a competition so I wont yea or nay, but if I may offer a similar yet different perspective:
In the (western) art world, entries made in a judged art competition are required to be the work of the entrant (either a single person or a collaborative effort). This does not mean that the materials used by the artist must all come from a raw state - many times parts of a "mixed media" work are a product made by someone else, but the artist always does something to the product to make the finished artwork their own, i.e. you can still see the "bones" of the previous artist's work, but the finished piece is artistically very different from before (Marcel Duchamp's L.H.O.O.Q. comes to mind - look it up on wiki)
So if bonsai is a horticultural ART, does this mean that the same conventions apply in a judged competition? If the answer is YES and it is an ART, then by the above standards only artists and not owners may submit works. In the eyes of art judges, if someone buys a piece of artwork they may not show it in competition as their own - they are a caretaker, a curator and maintainer of that piece of artwork - nothing more. (One must then wonder if people who collect bonsai and just maintain them in the vision of the previous artist fall into this designation if we were to judge bonsai as we judge all art)
But as we know - bonsai is not like most arts in the fact that it is not static - so even though one may purchase someone else's work, given enough time and training they can turn that tree into their own through a transformative process in which the "finished" tree looks markedly different and has a different artistic style from when it first changed hands (like the mixed media mentioned above).
It seems what we are conflicted over is that we lack categories of judging to differentiate between these levels of artistic "ownership." Should we judge "creators" of bonsai on the same level as "maintainers" of bonsai? (i.e. should we judge a new painting of an up and coming contemporary artist against a Van Gough that someone happens to own but brought to the same competition) That, I think, is the crux of this argument. If we are to award artists who create bonsai, then perhaps there should be a separate horticultural award for those that maintain a purchased bonsai that is not appreciably changed from the previous artist's vision, because let's face it, maintaining an old, award winning bonsai is a feat unto itself, but it's not the same as creating one if we were to view it through the eyes of an art judge.
Food for thought...