Well it seems to me that filing the sanction is a waste of time in the first place. The first reason most file for sanction is for the extra protection. However if something happens at your even the sanction is void, unless you can get everyone at the event to lie. So really ... it's pointless to sanction the event, because if something did happen you've risked everything for something you never had in the first place, added protection. You've also breeched a contract/sanction with a not for profit organziation ... heck man the way you are stating it you not will breech the contract, you've falsified it in the first place.

You're solution is the poster child for the term "occams razor". In this case the solution is so widely obvious ... you need to just go ahead and cancel the sanction and just call it a fun fly with normal AMA protection. You can have 1000 guys show up and if you follow the safety code you still get the general protection the AMA offers.