Recently another furry news site did an article on how MFF has recently banned fan art. Then gave a list of why this was wrong. On the other hand, I can give you 1 good reason why they did this, why other cons, not essentially fur cons have done the exact same thing and of why other sites such as Etsy has also recently banned fan art.
They just don’t want to get sued by the copyright holder. Nintendo is not the only one that has caused sites to change their rules about copyrighted material. In the last year, I had to delete some works due to a C&D. Really no one wants to be sued, and cons are simply protecting themselves.