720x480 is at least the maximum resolution; it's not arbitary even if the LCD is 320x240. The RAM specs are correct, and although the 240 MHz CPU spec is technically inaccurate that was an official announcement by Craig so it makes sense. It does have 2 CPUs rather than a dual-core processor, they are individual and self contained in the MMSP2-- not one combined unit. So that is also accurate.
Now, what is inappropriate is the handling of a contest where so little time is provided and most of it is eaten up by stalling! It'll be a stretch to have something worth entering by Sept. 30th if they can't even clear up enough details to give us major motivation to hurry with a playable demo of Stargazer. Odds are some drag-and-drop SDL port of some application ends up winning and gets $5000...