As mass gets down, an additional rule might be needed.
Let me explain: .craft editing is not forbidden explicitly in the challenge rules (as far as I know). It should not be completely forbidden, as .craft editing is necessary to align the thrust vector with the center of mass of final stages like this Eve one (LV-1R has an arbitrary thrust offset, and the Kerbal in the command seat has an arbitrary mass offset. This is compatible with in-game editor restrictions). I also used .craft editing to find a tight fairing (whilst respecting in-game editor restrictions -- e.g. no less than 0.2 distance units between sections, at least r>0.3 if not capped, etc.).
However, when .craft editing, it is possible to circumvent in-game editor restrictions in several ways.
There's 3 options:
1. Explicitly allow all .craft editing. As .craft files are perfectly portable between installs, when you download an edited .craft file, it works in a vanilla KSP install. However these files might not be possible to generate within the in-game editor. (This is very cheaty and broken, but would lead to cool new designs that are, again, portable to a clean KSP install). (This results in a set of .craft files that is a superset of in-game generable .craft files).
2. Allow all .craft editing done in such a way that all in-game editor restrictions are respected. (I like this one as it allows a lot of freedom without being cheaty). (This results in a set of .craft files that is equal to the set of in-game generable .craft files).
3. Whitelist the kinds of .craft editing allowed. For instance, allow for part displacement within sensible ranges, part rotation, and fairing construction (such that in-game editor restrictions are respected). (Impossible to enforce since the resulting set of .craft files is equal to the set of in-game generable .craft files -- i.e. indistinguishable from the set described in point 2. However, if we trust each other, this might be fine).
A fourth option would be to disallow all forms of .craft editing. However, this is not enforceable as the resulting set is equal to sets described in points 2 and 3. (And would result in retroactive and biased (as unbiased .craft checking is impossible) disqualifications of the challenge).