Personally, I don't think many of the people saying it's strange are doing so because of the prize money. To put the complaints another way, it's like running a marathon only to have found out that a few people got to start their race halfway to the finish line, but their time still counts.
Viewing post in Games Should Be Made DURING THE JAM PERIOD
I'm not saying that prize money is relevant for everyone who entered - I am saying that almost everyone it is relevant to is most likely enjoying the jam less because of it. Or else I cannot comprehend why usually it's fine to compete as a single developer against teams of full time devs. Yeah, there are people like Daniel Linssen https://managore.itch.io/ but I'm 1oo% convinced they use some kind of black magic or something ; )
That marathon example is a great analogy! This is my first real game jam that we were able to finish a game in the "allotted time"*. However, semantically, I joined the game jam thinking the "spirit of a jam" was meant to foster camaraderie, build new relationships, promote innovative ideas, and inspire people to make games as a community.
Allowing veterans to be considered "better" than others via an actual monetary worth doesn't seem like it supports these values. That mindset seems more attuned to the word "CONTEST", where the majority of the participants are competing in a cut-throat unsportsmanlike fashion. I think contests are okay, but I don't think a contest should ever be called a jam. (Just an opinion; so, of course, others are free to see otherwise.) Jam rules that allow for reskinning create a situation and vibe that is hardly different from https://www.yoyogames.com/en/blog/gamemaker-award-2020-vote-for-best-game.
Originally, I thought "If I see any more 'jams' that are really 'contests', I'm not going to join them", because the competitiveness is depressing and I could be spending my precious time on all my other game ideas. However, the one IMPORTANT thing that makes me reconsider are the comments that we have received. Someone actually played our game and liked it enough to comment. This game we tried to make in this small amount of time was interesting enough. Would these same people have done so for a game we took a year to make and merely posted online outside of a jam / contest?
Maybe, at the very least, we could have the Clay Aiken effect. You don't have to win American Idol for the people who appreciate your talent to get connected to you. In the end, I feel like game developers, like any other human being, just want to be able to connect to people that understand them, and their method of communication is a game.
I don't think it is necessarily the "losing" (to a veteran's reskin) that feels uncomfortable, but that the "winners" may put in less effort than the "losers", and come out "on top". It's a a strange time problem, because the veteran technically HAS put in the effort; it's just that the effort was put in before the jam, and not many people can "unlearn" something they've gotten good at.
Maybe future jams could be split into experience levels (in addition to team count limits); like "no experience", "1-4 months", etc. . Lower experience can still decide to try to enter the ones with more if they choose. Itch could semi-enforce this if needed, because they would know how many jams you've entered previously.
* Allotted time - What was the allotted time? It wasn't clear to begin with. Was it the submission period, or was it the time since the topic was announced? If it was just the submission period, then how do you ensure that what was done prior to the submission period "wasn't development"? Personally, I believe development includes the concept and design. In fact, in a lot of industries, a great portion of the work IS the design.