A quick google search revealed names like Dr. Bat and others, who sell shaved and rolled bats for home run competitions; so, this situation does not appear to be imaginary at all.
I think the term "home run competition" really needs to be put in quotes and maybe a winking emoji at the end. I looked at some of these sites awhile back (after I was told of their existence by this board) and I never read where the "company" made any alterations to the exterior of the bat(like a disclaimer label to the other certifications). In fact one touted the fact that a visual inspection would not reveal any alteration and the end cap was guaranteed not to pop off. All I can think of is that they put the "home run" disclaimer on the site at their lawyer's recommendation so that if some kid gets hurt in game play, they can point to the disclaimer. I can't really blame these companies for trying to make a buck and put the blame squarely on parents (I doubt many 12-14 year olds are ordering $300 shaved bats off the internet) and maybe coaches from the comments above.
Good news is that my younger kid now realizes that his hitting slump was not the bat's fault. Now all I have to do is convince him that the new grip wasn't the reason he started making better contact. If I recall correctly, the ZEPP measurements are all done using a "ZEPP" bat. I feel sorry for some kid who has been hitting it out with his shaved bat only to find himself in the bottom quartile for bat speed when he heads off to PG. I guess he can always blame his Dad for sabotaging his baseball career.