My own thoughts as well (and not meant snarkily)
Hitch said:
It's not really a coding competition then, imo.
To me, coding means thinking of structures, architecture, methods and patterns.
In that case we have a problem of scope. Scope in terms of project scope, and scope in terms of implementation scope.
Because half of the above list is precisely about choosing the right items to bolt together into a whole, and parts of the other two apply at the site level as well as the module level.
But I don't mean to be a language-lawyer

What you say is correct, it's just that it encompasses the strategic as well as the tactical, making it hard to determine what the scope of the competition should be.
Hitch said:
But building your own is different, i would like to see how the user handles loads of the server, queries, security, XSS prevention etc.
That's coding.
And that's what I get paid
a lot of money per hour to do in the real world. I can't hold down two programming jobs at once. Is the competition prize a guaranteed contract paying top-dollar rates?
How "good" does something have to be for this good-natured competition? And can something be "too" good? This is why sports have different divisions (amateur, pro-am, pro, etc.)
So, even ignoring the valid (and not yet discussed here) recommendations of
snareklutz RE licensing, buy vs. build, category judges, etc., there still seems to be a problem of:
1. project scope (how big a project)
2. implementation scope ("real world-edness" of the code)
3. quality constraints (judging pro/pro-am/amateur code in one big vat)
To be honest, I don't know how to solve this problem. I've never been able to come up with a satisfactory formula, which is why I stay out of coding competitions.