Contests for design are a terrible idea, especially with the rules of this one (which are also so full of lawyering as to be a real pain to read).
See my comment on Schneier’s post (as Nancy Wirsig McClure.
Among other points, I reminded him that he didn’t use a contest to get a logo for his (past) company, Counterpane Systems. Rather, he paid a pro (me) for the design.