Yes, I get the impression that the comedy of "clunking obviousness" is exactly what this comp is looking for. The sample proverb -- “Ice cream is a dish best served cold” -- invites an eye-rolling duh! Something like "Revenge is a dish best served on a paper plate" would fall into the meaningless-rather-than-pointless category. It would invite more of a bewildered "wtf?"

You can have fun, although probably not for this comp, mixing and matching the two halves of various proverbs: "All that glitters gathers no moss." "A penny saved rots from the head down." "A stitch in time lifts all boats."

I'm not sure what it is to "set" a competition, since as far as I know it's not an American usage. But I have suggested Washington Post contests and then been among the winners, and it doesn't strike me as unseemly since I have nothing to do with the judging (and the prizes are trivial).

For this contest, I'm not sure how important it is that the proverb be utterly pointless, since if you took that to an extreme, it would ultimately be humorless as well, or every entry would be pretty much the same joke: A bird in the hand will shit on your palm sort of thing. (Yes, I suppose I'll send that one in).

My ten:

1. A bird in the hand may poo in your palm.
2. A watched pot will eventually boil.
3. He who laughs last was the slowest to get the joke.
4. Time flies. You'll find they're very fast.
5. When in Rome, be sure to try some Italian food.
6. Home is where you live.
7. It is better to have loved and won.
8. Those who ignore history will never know if they repeat it.
9. There's no point sitting on the toilet if you won't pull down your pants.
10. People who live in glass houses shouldn't.

Or try the reverse strategy?

1. One couple on Bondi is worth two in the bush.
2. Plagues, I can resist, but never boils.
3. The hysteric laughs longest.
4. Close your flies - it's about time!
5. In August - do as the Romans do - go to Tuscany.
6. Andrew Lansley is where the heart was.
7. Love is better not lost.
8. Those who repeat history are condemned to forget it.
9. It must be the Jubilee. Pissing, in't it?
10. Bowlers shouldn't throw stones.

And what a shame one can't use Frank Muir's
"Absinthe makes the fart grow Honda."
or Denis Norden's
"People in grass houses shouldn't store thrones."

Roger, your 'time flies' proverb should win: made me laugh aloud.

Here are some of mine so far:
The grass is always greener where the cat urinates.
In the kingdom of the blind, the one eyed man won't qualify for disability benefits.
Too many cooks, period.

Do you think they want existing proverbs modified (as in the "ice-cream" example) or completely invented ones (as in the "Scotsman") example? Or both?

If wishes were arses then buggers would have a very good time.
There are no flies on a pair of tights.
One swallow doesn't make you pissed.
A cat may look at a mouse.
Fine turds butter no parsnips

Bob's time flies is great, though it does recall the old:
Time flies like an arrow, but fruitflies like a banana.

Here are a few of mine:
1. A house divided is called semidetached.
2. A journey of a thousand miles is best undertaken by airplane.
3. A little knowledge can be dangerous; a lot of ignorance is even worse.
4. A picture is worthless to a blind man.
5. A rising tide will flood lowlying areas.
6. All work and no play probably means the theater is bankrupt.
7. If you can't stand the heat, you might consider air-conditioning.
8. An ill wind blows after eating spoiled food.
9. There's a sucker born every time a lamprey hatches.
10. You catch more flies with flypaper than with insect repellant.

Martin, yours are very good and fit the contest better.

My "time flies" does recall the other (Groucho Marx's?) but doesn't actually use the same punning meanings, so in that sense is completely different.

Bob,
you are right--the pun on time is different; the pun on flies is the same.
But I like all of your 10 a lot.