Why not make a contest forum? Allow one contest announcement thread in the main forum with the caveat that the announcement forum can not turn into it's own contest. I could see people abusing that thread, bumping it every three minutes, etc. I think if it's a good, carefully planned contest the thread would survive. Actually, who cares if it survives? If you want to do contests, check the contest forum.
You have a traffic trade/link forum because there were too many posts for that in the main; do the same with contests.
You could then have as many contests as people wanted. I would still set some reasonable limits; no person or organization could have more than one contest per week; contests can not last longer than one week; absolutely no "most posts win" contests.
No consecutive posts is a great idea. However, if you remove the "most posts" type of contest, you probably won't have to worry about spam posting.
Having a maximum number of posts per contest per person is really not maintainable. Who wants to count everyone's posts then do a final accounting at the end? Blah.. Again, removing the "most posts" contests should resolve this for the most part.
This one is important to me: Contests should have to be a
real contest.
Each entry post should require some kind of work or product or be assignable to a measurement standard other than the number of posts, or, the post number. Giving a prize for post 100, et al, could be a secondary prize, but the real contest needs to be measureable.
Example: Sarah from WebInc had a great contest a while back; post your best networking tips. 90% of the entries were on topic and useful to everyone. Well, maybe 80% :-)
Disclaimer: I won that contest so I
may be biased.
Allow things like banner and logo contests. Caveat Emptor. Contests that involve creativity are the best. If someone doesn't choose a winner, ban the bastard and smear his name forever. He's using your board to commit fraud. Screw him. Again, caveat emptor. If you need the prize money that bad, don't gamble on a contest - do some work.
I'd say, for banner/logo style contests with a cash value under $xxx (you can set your own limits), nothing needs to be done. Anything over that value, the money needs to be put in escrow, either formally, or, allowing a named third party to hold the funds. Someone or a few people could even volunteer to be the cash holders for the forum - make that an ongoing gig, not on a per-contest basis. I'd do that, but no one really knows me that well here
After all that, one final thought. If you really want to clean up contests, and don't want to have a seperate forum, require that all contests be pinned by a mod. Change the style for those pinned threads so everyone not involved can visually skim past them - we'll all get used to three (or x) pinned contests at the top within a week. Apply the rest of the rules as needed. Lock the thread or kill it if it's out of control.
If a mod has to be involved to hold a contest, you can be sure it's going to cut down on requests for bullshit. People will have to plan and schedule the contest, and get it approved in advance.
No matter what happens, any outcome from this thread will be positive.