I just got a reply from the people running the contest. Apparently, they got a google alert about this thread and I was asked to relay this information to people considering entering a script into their contest:
"We receive around 300 scripts each year, and yes, every script is read! If the contest entrant requests an evaluation, they will receive an individualized script critique. The script evaluations go out by the end of September, which is also when the Contest winners are notified. If you have any further questions, feel free to contact Playwrights Project at
write@playwrightsproject.org. More information on the Contest can be found on our website www.playwrightsproject.org."