In my opinion, provided that the school keeps those funds in reserve for the next band trip, retaining the earnings for that purpose is fine. Better than fine, actually, because the band will be ahead of the curve when it comes time to raise money for next year's trip.
Secondly, keep in mind that the school has expenses that had to be paid related to the fundraising. For example, if the kids sold cookie dough for $6/tub, the school had to pay the fundraising company their wholesale price of $3/tub when placing the order, so there really isn't $6/tub profit to return to the parents.
The only logical argument I'd say you have to push for a refund (given that the money is held in the individual trip accounts, is if your daughter is a graduating senior and won't get to benefit from using that money for next year's band trip. If this is the case, I suggest that you join together with other parents who have a senior and present a united front to the school.
Otherwise, think how nice it will be next year that your daughter already has money stashed away to help pay for her band trip then.
Our band trip has been canceled due to the Swine Flu Scare and our kids are being told the only money that will be refunded to them will be the money the parents paid and not any money they personally raised for their trip account through fundraising. I am livid. We worked hard all year to raise funds to defer the cost of the trip, I'm a single mother struggling to make ends meet, and now I would love to get the money and take my daughter on a nice little trip to make up for this one. What right does the school have to say they are not refunding this money. The money raised for the trip was specifically for their individual trip accounts and not part of the general fund raised by all other booster club fundraisers.