I don't really understand why people have such a problem with AR-or-similar-devices in these contexts (assuming the AR was only used to create pokemon that are actually possible in-game), for a couple of reasons.
For a start, what are you trying to assess? If you're trying to see who's the best battler, the best team-builder, and Pokemon set designer, then restricting the entries to only "legit" copies is assessing something entirely unrelated: who has the most time to spend playing video games, or the person who has the better luck with the randomness in the game. If that is the case, then you may as well forgo the battles entirely, because you're not actually trying to assess that anymore,
Secondly, the argument about "letting everyone have an even playing field; not everyone has access to an AR" is flawed, because unless the person in question doesn't have the internet (in which case, they won't have any of the associated competitive battling knowledge), they will have access to an AR. There are people on Smogon, Serebii, and GameFAQs that simply create custom-requested hackjobs and trade them out, sometimes for (essentially) free, and other times for in-game stuff that is much easier to obtain.
Furthermore, the line for "legitness" is rather subjective, and is usually based on the speaker's access. With the advent of RNG abuse, the 'in-game'ness of non-AR teams is starting to look a little more blurred. Not everyone will have access to RNG abuse either, but would you ban that? Why?/Why not? Is it because you can do RNG abuse but don't want to shell out the 40 AUD to get the AR?
Finally, I have a problem with enforcing anti-hack rules, because when hacking is done properly, it is indistinguishable from a legit pokemon, and hence disqualifications are then arbitrary, and I don't believe in having arbitrary rules systems in tournaments where people are paying (and making other sacrifices, such as large travel costs) to play and win prizes. If people wanted luck-based awards, they'd buy a Lotto ticket. Hence any anti-hack rules are quite likely to miss hackjobs, and penalise legitimate entrants.
Furthermore, while it's all well and good to say that "It is the responsibility of the entrant to make sure all his pokemon are unhacked", many legitimate players will have no way of even checking to see if their traded pokemon are hacked or not, and hence they will be in for a rude surprise when they travel 1500 miles to compete.
Ultimately, when used properly, the AR gives nothing to the user that they couldn't already get in-game, it just saves time. (For that reason, you could make a loose argument that the AR helps breed further creativity in battling and movesets, because people are freer to test and experiment without having to EV train loads of things over and over again to find exactly the right choice to complement their team).
It's also completely impossible to provide a perfectly level playing field (since not everyone will have access to RNG abuse, for instance), so arguments on that basis are inherently flawed or arbitrary, or cannot discriminate between legit and illegit.
The fundamental question is this: Why is something more legitimate just because it took more time to achieve than a faster, but equivalent-output alternative?
