In reply to Enter the world’s premier Typography and Typeface design competition:
I have no idea why Graham can't answer a direct question, but I'll share my understanding from the outside.
The entry fees cover the expenses of bringing the judges together for judging, which presumably include airfare, hotel and meals for those who are outside NYC.
The winners' fees contribute towards the expenses of mounting the traveling exhibit and showing it at other conferences and locations. For example, the TDC award winners are typically shown in a huge display at both TypeCon (somewhere in the US) and ATypI (somewhere else in the world).
As ATypI Treasurer, I can attest that ATypI pays a goodly chunk of the costs of getting the exhibit to our conference (this year was Hong Kong). However, my recollection is that we aren't normally covering all the costs. For example, the costs of actually printing each entry out as a big full-color poster....