Seems to me that a lot of the people bagging GPSTC don't really understand the format of the competition.
There are six categories and only 3 of them (2 sec, 5 x 10 sec average & nautical mile) are purely speed-based. The alpha is all about cross-wind speed and excellent gybing. The hour is also about executing consistent, fast gybes and physical endurance. The distance category is for all the unemployed (or under-employed) bums who get to sail whenever its windy and and whenever they feel like it (including some of my team mates)
In fact unless it's really nuking (25K+), and I've got the time to venture somewhere like Safety Bay, I don't really focus on peak speed. I regularly launch at Pinnaroo and tack upwind to the breakwater, or set out from Peli Point and tack upwind to Melville or Point Walter, and sail back again. Not because I'm trying to massage my ego by going quick back downhill, but because I like sailing different angles (upwind, across wind, downwind) and find it more interesting than simply sailing back and forth. You can actually journey somewhere and back. I rarely even look at my GPS during these sessions, because I'm not focused on the numbers, just having fun.
As for the 'beach scene', well I know far more sailors now than before I joined GPSTC, and I've shared some epic sessions and road trips with some top crew. GPSTC has created a community of like-minded souls to share the stoke.
I don't agree about the implications for the racing scene either. I've done the LOC 5 times since I started GPSing. Before that I only had wave and free ride kit and when I did enter my kit wasn't big enough for the light conditions that often prevail.
Events? I have to concur with others, I think it's more about the logistics and lack of volunteers than any consequence of GPS racing.
So I'm having a hard time seeing any negatives. My sailing has improved out of sight and I'm always up for a drag across the river. I reckon I've shared a few with some of the posters bemoaning the lack of drag-racing rivals.