Welcome to the sport! Their rating is too good to qualify for either MA-2 or MA-3, so they'd have to play MA-1 or even MPO if they didn't play something age protected for which their age qualifies them. While I would agree they should be playing pro masters (aka MP-40 or MP-50) once they're up in the 930's, they're not bound to that by rule currently. Anybody who turns at least 50 in the calendar year is eligible for MA-50, even if they're 5 strokes away from being in the top 500 players in the whole world.
Same thing happened to me for a tournament coming up this Saturday. I'm competitive with other 880-900ish players in MA-50 now, and I just saw a 943 rated guy sign up. If we both play to our averages, he should cream all of us, probably beating 2nd place by about 10 or 12 strokes for the 36 hole c-tier.
I don't find that to be honorable to be honest. Back when I first entered sanctioned events in 1998 I actually tied for first in Am-2 at a big state level tournament (choked it away on a playoff hole) and always finished in the top 5 out of like 30 or more players, so I moved up to Am-1 like a man and never looked back, even though it meant way less in winnings for me. There was no rating system in place for a good year yet at that time and I could've stayed in Am-2 and won gobs of plastic, but I didn't want to be known as a sandbagger. Shame was the only thing preventing sandbagging back then. I love the ratings system and agree it should be used for old players now too. If you're 950 you should absolutely have to play pro masters.
My rating fell to below 900 for the first time ever this year but I refused to enter Am-3 and take away prizes from newcomers and kids. I could have done that without breaking any rules. I'm not ever going to do that.
There is one instance where good oldsters playing MA-2 or MA-3 isn't sandbagging in my eyes, and that's to earn enough points to get into worlds for the next year. The points system for entry into worlds is stupid in my opinion, where you earn points for each person you beat in a tournament, and the MA-3/MA-2 divisions have gobs of players in them. Age protected worlds entry requires something like 1000 and 500 points for MA-40/MA-50 respectfully IIRC, and those divisions are usually nowhere near as populated as MA-3 locally so it's way tougher to get the number of points it takes to qualify for worlds if you just play age protected. A guy might live in an area with only a few MA-40/MA-50 players around and not have a chance to get enough points that way, so they're relegated to beating up on newcomers and kids for those points. There has to be a better way.
I guess you could view your experience with these guys as an educational one and learn from their prowess. Hope you can find value in your participation. Best wishes!