I like this, I think that this is a great discussion!
It's not so much a lack of beginners but a lack of more experienced builders. If there were more people taking part then we would have seriously considered the different categories but we rarely had more than 6 entries and it just wouldn't be worth while for the additional work. We hoped that one of the main things about the contests would be people wanting to take part and challenge themselves, not to only enter if they felt they stood a chance at winning.
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Yes the challenges were to help people improve and practice their building but at the same time it was a contest and each entry had to be one persons sole work. That and some people might not want feedback on their entry, especially when the contest is still open to entries. Once an entry is submitted it can't be altered, so it would give others an advantage to see what potential voters thought. We also wanted to keep the threads relatively tidy at the start with only entries, questions or answers then followed by comments etc. What do you mean "marked as such"?
Just to play devil's advocate... Wouldn't you attract more advanced entries if people didn't feel as if they were entering a beginners challenge? Also, even though most of your entries were beginners, the more advanced entry always won.
An aspect of the challenges you seem to be missing is community. If the point of the challenges is not only to try to win, but to foster creativity and improve building skills, then your missing the key aspect of community. This can only be gained if you let go of a few of the rules. For example, I recently started participating in TheSims3 forum's Build & Share Challenges, and I didn't know what category to enter (beginner, intermediate or advanced). So, I asked, and received a lot of support from the community. I made a comment that my roofing skills were not where I'd like them, and someone posted a link to a tutorial (that was actually helpful). Another newbie felt discouraged after the last competition because she was just beginning and felt the advanced entries were so advanced, she could never be as good. She posted her discouragement and received tons of support and encouragement from the community to keep going.
If the forums were locked against posting then none of that would have happened. My roof wouldn't have been as nice (though it was still very flawed). I didn't copy and nobody told me what to do, but the community was helpful. That girl would have felt discouraged and would have completely stopped participating. It would have been much worse if her entry was being judged in the same category as the advanced entries. Based on some of the previous posts in this very thread, it seems that similar discouragement happened here too (though for different reasons), which decreased your participation.
I understand wanting to keep things clean, that is very important. As it is, the B&S thread is one giant thread for every single challenge, and it seems a bit of a disaster. You do make separate threads for each challenge, which would help. Another thought is to create a discussion thread. This would help foster the community you need, while keeping your entry threads neat and clean.
By "marking as such" I meant each entry needed to have a "form" with a caption marking the post as an entry. This is not important if you only have entries in the thread.