I am also curious about the reason. If it were just a case of people getting upset about their kids not getting picked, then I would think Disney might just take the opportunity to just charge for them after the show. An opportunity to make more money, and parents can be the highest bidder to make sure their child gets the prize, uh, candy.
The first time we saw her, my DD did not get picked, but we were not in the front because we just got there at the last minute. DD looked at the schedule, and purposely stationed herself right in front of the cart 30 minutes before the next show. She stood there patiently for the 30 minutes, no other guests were waiting with us, but we did get some strange looks. I reminded DD that she still may not get picked, she knew and was OK with it. By the time the next demo started, a crowd had built up around the cart. But my DD was picked first, and it really did make her day.
I agree that if this is in response to children getting upset, then it is the parents' fault for building up the kids' expectations that they will get picked. I find that as long as I remind my kids that someone else will probably get chosen for whatever, then they expect that going in, and don't get disappointed, and if they do get picked, it makes it special. When parents act like their kid is entitled, kids pick up on it, and they are crushed when they don't get what they want.
I will say, though, that this is a job for parents. Not for Disney. If enough parents complain, I can totally see them just saying no more candy for anyone. It's easier than trying to change the mindset of thousands of parents on vacation. Disney's job is to make people happy- not teach them the harsh realities of life.