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You wouldn't say they are taking advantage if they were offering a prize. If they just said, 'Please draw X doing Y.' That would just be a request for people to take if they wanted to and I assume you'd be okay with that? How is offering an incentive suddenly making that so terrible?

I also can't say I've ever seen anyone say they get all the rights to any work submitted but even if that's true the artists or authors enter by their own free will. An honest contest is one that isn't hiding anything, not one that is doing what you think is the nice thing to do.

"If all mankind minus one, were of one opinion, and only one person were of the contrary opinion, mankind would be no more justified in silencing that one person, than he, if he had the power, would be justified in silencing mankind."
~John Stuart Mill~

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