There are some excellent fan films involving Star Wars out there. Mostly they tell other stories, not recreating the principle characters or sets- no one was cast as Han or Luke.
One humorous series "Pink Five" did show events from the original trilogy from a different point of view and IIRC was publicly embraced by George Lucas and was being shown at major conventions.
Yes, I've noted that and haven't yet seen an explanation of that studio's approach to fan films. Have you? The contest clearly doesn't itself prohibit all other productions. My impression has been they have also been playing the unstated boundaries game. Have any star wars fanfilms tried to make a permanent studio out of their fundraising or sold toys unlicensed?