My friend emailed me a page from the NY times on piano competitions, but it’s all relevant to guitar competitions. I mean it’s pretty obvious, but people forget how it’s so very hard to become well known unless you’ve won a few of these. These guys who win are a particular type of player – they’re the standard player who avoids controversial interpretation and plays it safe. There’s no daring, and the interesting players who risk it all are never those who win.
Look at Bozhanov…
Yeah I know huh.
Now look at the comments.
God damned competition mafia. Back in the golden age of guitar this stuff wasn’t so common, you could get gigs by simply being heard, and being good. The bitch of it is that playing it safe, being nice and getting a brown nose pays off.
The other link is this one, which is kinda entertaining.
Sean Shibe 
There are also some interesting views here
http://en.wikipedia.org/wiki/International_classical_guitar_competitions
In particular… see the bottom section (Further reading), which presents numerous critical articles.
Yeah actually I saw this the other day, very interesting. Azabagic is totally right in “I think winning competitions helps you build a name but does not help much to develop your artistry.”, but I might go further and say that actually it can undermine artistry and diversity of interpretation in guitar/music/whatever…