While Dremel-ing can certainly be done safely, it can also present a serious injury risk. The incident I always share when questioned about the need for safety goggles comes from a Dremel, in which a cutting blade shattered and one portion went flying across the room and hit my glasses. While it’s certainly very possible to use Dremels in a safe manner, I don’t know if I trust the high school students (or even mentors) on other teams to be using them in that safe manner as they work in an unfamiliar and restricted environment (the pits) under the often intense time pressures of competition. Rather than enforcing the rules in a non-uniform fashion in which the safety advisors allow some teams to produce sparks and others to not produce sparks, I think it likely makes more sense to ban sparks all together.
With all things pit safety, the question isn’t really “do I trust myself/my team to do this safely” it’s “do I trust everyone at the event to do this safely.”