Such bunt-swings are allowed in Little League. Many local leagues ban them in regular season play, but they are permitted in all star / tournament play.
Then how do many of the local leagues expect them to defend it if they face a team from another league who allows that? District 3 allows it but District 2 in Ohio doesn't in state play. I think it hurts those who aren't allowed.
Are you saying in District play during allstars they don't allow bunt-swings? I could be reading that wrong, maybe you are just talking a league in that district 2.
But, I agree, I think regular season play should look similar to the state tournament play.
The danger in slugging comes from neglectful coaching, often times...Coaches must emphasis the slow creep when bunt is shown. Just my two cents! : )