I raised this topic on the mailing list, and I strongly believe it does create confict of interest. I'm sure most of inspectors/submitters are honest folks, but then there are others.
On various forums, I have seen people quoting very absurd rejections. So, it is either slapdash work by inspectors, or deliberate attempt to suppress competition. Many rejections are subjective, so if inspector is in doubt, there are 100% chance your photo which may compete with inspector's bestseller will be rejected.
The best resolution of the confict, is to avoid it.