PS ... if you watch the 7/22 race, look at USA 210 and 220.  That's what it looks like when a Vakaros compass is out of calibration.  If you look across the fleet .. many boats seem to be a little off-kilter one side or another. 

BTW, this is also the race where I learned (USA 159) that the Distance to Line # readout on my Vakaros device was measured to the bow and not to the outline of the boat.  I was running the line showing 1-2m to the line so thought I was good, but my toerail  was OCS by 30cm.  :-(

Lesson learned!

Thanks very much John. I appreciate your efforts in replying in so much detail.

Our annual program includes a Pointscore Series (Pursuit format; scratch -> biased towards slower boats) run every fortnight ( 15 races per season), Championship (Yardsticks; 2 races each day; 14 per season) and Sprints (Yardstick, 3-5 races per day; 24 say races per season) => run in turn every other week.  (so C-P-S-P each month).
 
We'll be running our annual October Regatta (6 Divisions) , Hobie States, Spiral Nationals + the International Canoe World Titles this year so we'll be busy, and having lots of fun and enjoyable times out on the Bay!

As Race Secretary I want to apply a common entrant list and a common set of rules for our club races. (KISS).  We are transitioning from a Cox-Sprague system to low-point (Sailres) next season. We have a meeting next week to decide on the rules.

After much research and simulations and yours, and others kind feedback, my preferred approach is DNC= Starters+4. I thinks the committee could settle on DNC = [12] which is starters + 4 for our average fleet size of 8-10. There is a group who want to keep the regatta approach of Entrants + 1.
 
We'll see who 'wins' the debate. Interesting Times (pun intended)! 

Cheers and Thanks again for all the great feedback. 
PS many clubs face similar issues and so it is worth discussing it here.

Looks like several scoring systems allow for it.  You will find the instructions for how to do it on RacingRulesOfSailing.org here.

This may be relevant =>>>   https://www.racingrulesofsailing.org/posts/5752-minutes-advantage-formula-for-pursuit-races-based-on-phpf-hcp

Yup, Case 67 settles this explicitly in a W/L collision causing damage to a non-racing boat, it does not explicitly deal with the amount of damage caused being a conflict since in this case the rule 69 implications removes that discission.  I can't find a case where monetary damages were seen as a conflict of interest in the way it's implied in this discussion.  But the definitions are poor for several things including "damage" vs "major damage", and major damage isn't even a requirement, only that it may have caused major damage. so there is always room for interpretation.