It all comes down to judgment.... there is no way around it.
While I agree that good judgement is very important, I don't think that "judgement" is the crux of this issue. I feel that the key point is "sportsmanship". Good sportsmanship may sometimes mean overlooking trivial infractions, but it always means following the rules - all the rules, even the ones you may not like.
Quote
If the class doesn't make it clear what the unwritten standards are, you KNOW, some individuals will use the rules as a weapon to win..... IMO, Those classes tend not to thrive!
Well, by their very nature, unwritten standards tend to be unclear. I've sailed with classes where protesting is highly discouraged. My observation is not that "some individuals will use the rules as a weapon to win", but that some will take advantage of that "culture" to get away with breaking the rules. That's when honest competitors get discouraged and leave.
Let me give a more concrete example. In a multi-class regatta, I was sailing on starboard tack and had to take action to avoid another boat in a different class on port tack. I hailed "protest", he did his turns, and we sailed on. When we got to shore, the other skipper complained that I had nothing to gain and should not have protested him. He felt that I had wronged him by enforcing the rules. So, I asked him "What makes you think that the rules shouldn't apply to you"?
I ask you the same question. What makes you think the rules shouldn't apply to you?