Mike,
Your response is just about exactly how I feel about the whole thing.

My feeling is that it's always been about the wind, but figured I'd ask to make sure I'm not missing something in ignoring waves. I think we've been fairly accurate and fair about the adjustments we choose, but I will not claim to be infallible.

Between the commodore and myself, we have pretty good experience for judging the wind based on what our boat sees - for instance double trapping usually rules out under 10 knot breezes with 400 pounds of crew weight, etc.

We have some instruments available - but with interesting results. The gauges at Pirate's Cove are aligned to be accurate when the wind funnels out of one of the creeks. But that's a localized effect you don't see on the whole course. If the wind comes from a different direction it reads low because it's blocked. Thomas Point data shows other interesting effects from wind direction and lack of shore effect. Good references all, but not as accurate as what you see where the race is.

The best option is your #2 with one caveat - getting consensus from the racers. I have found this one area where autocratic rule is best, as long as it is trusted and usually accurate, and I do my best to be trusted. Once you start adjusting the adjustments to match somebody's perception of what should be right the whole thing falls apart quickly.

Anyway, it sounds like my original question as to whether anybody uses the sea state for anything other than a visual aid to help decide the wind speed has been answered. The premise that the beaufort scale number used should be lowered if the sea state doesn't match does not seem to fit definitions or practices.

Cheers!