I won't cut the conversation. We have ruled in the past, specifically for the Suian and Tyrogatorian competitions that because it is a setting where both opponents clearly know they are in a dangerous situation and wouldn't be caught flat footed since they would be aware of danger and alert immediately.
I held that ruling over from the Suian and Tyrogatorian tournaments, and it has already be used in this tournament and it will come up again, so it is not an irrelevant debate.
I agree with Derek. The combatants are aware of danger and would not make sense to be caught flat footed because they lost the initiative roll. That makes sense. Now the question is what the power level of the immediate actions in question. I would need an example of a few that would tip the scales of power in a match where someone winning initiative over the wizard is crucial. If You can say...ok that really tips the power scale too much in favor of the wizards then that would be more open for debate. As a rule question and what makes sense to me, I agree with Derek.