First the TA tried to spin the Carnival policy by saying "its a rule for everyone, not just drag queens, no one can walk around in a costume on a cruise ship - it's a security issue."
But I don't think the customers bought that. They found out about Carnival Halloween parties and other theme cruises.
This is one reason why (1) such groups should ALWAYS try for full ship charters when possible. They had a lot of people booked - some 1500, that is just right for a small Holland America ship (and HAL does a LOT of charter cruises).
And (2) - when a regular cruiser books a cruise always go to Google and put in the name of your ship, sailing date, and the word "Group" -- if you do "carnival glory december 2 2012 group" you see mentions of this group.
I saw a link for a Celebrity goosip site in my Google search that discusses the chain of events...
1) Carnival sends out a letter to everyone in the group saying "no cross-dressing allowed"
2) after the blowback from that they send out another letter - "we will refund your money if unhappy" - but when people DID start asking for refunds in droves Carnival said...
3) "Just Kidding" you can dress in drag if you want. Just remember its a family ship and you have to carry ID...
As one person commented "with all this backpeddling you could power the ship for the entire cruise."
By the way - The Carnival refund did not incluide ALL of the added fees the travel agents (rightly) tacked on - event fees, etc.