As far as loitering aroound a fight I wish you guys would be more vocal on that. We can't see all the fights and notice everything that goes on. A little peer pressure might change that. Last year I was accused of letting this go on and this is one of those issues that is really difficult to control with the different fighting styles there are.
Pretty sure it would be impossible to define but what exactly is engaging. If turnfighting it is more obvious than E fighting but there is still a rather large grey area involved.
Problem is, you can easily "loiter" yet still be following the rules of KOTH. This is very easy to do when you are going 400 mph in a rocket.
As I mentioned before, the Me163 should be outright banned from competition because engaging in acm's and rolling scissor, which is in the full spirit of koth, almost guarantees you will run out of fuel and lose the round. The only certain way to win the Me163 round is to keep 987 gph (just above 982 idle) and make weak pick attempts before low g high yo yo's and rinse repeat, while avoiding passes from suckers using too much fuel. Again, not in the spirit of koth unless you are given the option to triple or quadruple the fuel loadout.
As for a max number of players for allowing it, meh, I like the effort to try and salvage it, but it's not really worth it imo.