I haven't attended a flyin where foam models were not allowed, although I seldom see foam models at these events. When pilots reach the level of proficiency and confidence to fly at events, they usually have the same proficiency to build and fly larger, balsa and composite air frames.
At this level, it is not uncommon for many to build their models from kits, plans, or their own designs.
I feel that you may be equating the lack of foamies at events, with them not being allowed. I believe that you do not see them because they are not the air frame of choice for pilots that attend flyins.