From a nerdy point of view: Would you consider stories selected for the anthology to be canonical? I could see that going either way. I think if you canonize the commissioned work, it’s only fair to canonize the winning fanfiction. In the end, it probably doesn’t matter, but if the IP has a lifespan of say 10 years it might.

From an fledgling author’s POV: I totally agree with your attitude towards people creating fanfiction. I mean, if they love it they’re going to do it anyway–why not officially sanction it, and thus engender good will between the author and their audience? It’s like the music industry allowing mashups. It only creates more space for the original work to be digested.

Then again, like you I wrote quite a bit of fanfic in my early days (Star Trek, Hercules, Final Fantasy Tactics). It’s kind of funny how easily it can date your childhood.