I'll find out soon enough. I think I might have the time to put up one hardware project on Kickstarter in about a month or so. The actual product will be shown in finished form. I'd like to use Solidworks animation to show some of the clever mechanical design that makes it work. Clearly there is no way to do this with the actual product as it would require aluminum to be transparent. There's also the case of some shots that are simply impossible to achieve any other way (animated cross sections). My guess is that the KS guys probably get this and are simply looking to host more legitimate, for lack of a better word, hardware projects. I can't see anyone who really knows how to execute on hardware projects have any issues with these restrictions.
I'll certainly consult with the KS guys when ready and see what they say.
Seems like they could get 100% of the ambiguity reduction they are probably going for with the "no renderings" rule by requiring that any renderings have a standard label. Some very noticeable and tasteful diagonal bar saying "Rendering" across the corner of the image would do nicely. Perhaps you could/should propose that to them as a sensible middle-ground position.
I really like the "you have to show what you have now" part of the requirement, but getting a look at where the creator wants to get to as a goal is also very useful for choosing projects. And your cutaway animation also sounds like a knock-down case for why renderings are needed sometimes.
I'll certainly consult with the KS guys when ready and see what they say.