Amigos Y' Amigettes 
This has been an issue I've discussed with numerous photographers, not just those entering contests. What is considered "too saturated" ? I personally think example #2 "pops" significantly more than #1. This goes along the lines of water color and "too blue, not enough blue", etc.
Funny thing is, on the same dive several of my customers will have different colors in their photos (based on camera brand, post processing, etc.) and who's to say what's "right"?
Same thing in contests happened when Fuji's Velvia slide film came out. All the purists cried "foul"! and "Not accurate!" But these image's impact eventually had EVERYONE switching to super saturated films, including those selling work...Hell, you didn't even submit a slide that wasn't E6 saturated film back in the 1990s if you wanted it to be even looked at by an editor 
I find it VERY INTERESTING that we're going through the same dilemma now in digital whether in contests or just sharing photos.
I guess it's like another subject, to quote: "I can't exactly define it, but I know it when I see it" 
YMMV
David Haas