We had a similar post a while ago asking for the original words that Ueshiba used when saying aikido shouldn't be competitive - to my knowledge there was no definate answer. However there was a bit of a disagreement between Ueshiba and Tomiki when he tried to make it competitive.
A strange thing about aikido is we say that aikido enables us to deal with an agressor without hurting them, but then say competition is not allowed because the techniques are too dangerous and you could seriously hurt/kill someone.
My feeling is that aikido is really a way of improving your bodies ability to deal wih an real attack, rather than improving your sparring/wrestling ability. In real life you have to use everything you've got. What we are training is to improve our reaction, and our uke acts as a guide to make this reaction instinctive and natural.
As soon as it becomes competitive the realism can actually dissapear because, in the dojo, you are not in a life/death situation and you will back of striking uke or nage vicously if they leave themselves open.
One of the ways I teach irimi-nage is actually to teach a rear choke first. Uke soon find out that, although turning out of irimi nage (by turning their back to nage) gets them out of the throw, it is a stupid thing to do as they fall straight into a choke. This dynamic raction between uke and nage must be kept in mind at all times if we are to take advantage of the non-competitive method of simulated fighting.