I've seen this before. I was involved in one where the winning team had been working for months beforehand (their website was registered > 6mo before the event), had prepared presentation materials far before the event including design mockups, and presented with nothing more than a pre-cooked video that was looked manipulated to show "working" code. None of us knew for sure, but it looked like they had just built static HTML pages and transitioned between them.

For those of us who had built working products, it felt more than a bit cheap. We saw some great code and very little of it was recognized.

I believe the issue is one of expectations and marketing for these events. They are pitched as "hackathons" and try very hard to attract engineers, as you simply can't have the event without coders. Therefore, engineers reasonably expect an event where the best code wins. After all, it's called a "hackathon", not a "meet & greet with investors" or even a "startup weekend". In the end, it just felt like the judges were putting themselves into the mindset of investors, and in that case, obviously the team that has prepared for months beforehand will win. But to the coders, we felt cheated, and that they had completely missed the point.