First things first, the word they're looking for is gender, not sex. Sex is one's biology and matters in a handful of cases (such as certain medical procedures and intimate relationships) where as gender is how one presents one's self. Gender is the thing that they are attempting to differentiate by here. And there aren't just two either. What is a potential participant is neither male nor female? Or both? Congrats, you've just managed to alienate a whole bunch of people who've just had it reinforced that they've no place in society.
Second, the reaction to a "gender battle" shouldn't be something to be applauded or goaded on. Placing people in a group based on their gender and pitting them against each other is at best going to affect the decisions of the judges based on pre-existing prejudcies (conscious or otherwise) and at worst reinforce the ideals that lead to comments like "Why are you out of the kitchen?".
So yeah. This is a bad thing and the organisers should feel bad.