Yeah, I figured that might be the reaction, but to use an idea of Warren Buffet's, YC News has a natural competition 'moat' in that it's backed by YC itself... why would you go to another startup news site? Unless Sequoia starts it's own news site, I think YC News is safe. I know I come here because I know the content will be reasonably related to what is going on at YC, not because I think the moderation system is the greatest thing since sliced bread.
On the other hand, if it uses the same system as Reddit or something, I could see the reluctance, since Reddit gets to fight it out with a bunch of other sites and doesn't really have a natural monopoly.