I would much rather have a "limited food and beverage" rule. But, other than campaigning for a change in the policy, I don't think your group can do anything other than go along with it. Classrooms can be set up into stations with games and activities, including at least one quiet, like a story being read. And like you said, the list of non-food rewards is lengthy.
My son's 2nd grade teacher had a strict classroom policy that the kids got to choose one treat (cookie, cupcake, rice krispie treat and the like) AND one piece of candy, along with their beverage. Everything else was wrapped by moms or dads in the room and went home in a paper lunchbag. I was thankful that my son wasn't bouncing off the walls those party days. And seeing how he's autistic too and was prone to end of the day meltdowns, the teacher was giving me a HUGE break.

I am interested to see how other PTO groups handle this situation. Our district has installed a "No food" policy for any class parties. On one hand, I think it's okay, because, we are eliminating all of the parents that tend to go overboard on the treats. On the other hand, what the heck is wrong with a cookie and a cup of juice once in awhile? I have many lists of other, non food rewards, but, my PTO is just ambivalent to go along with this policy. I am president, and just curious to hear what you all might have to say about this. Thanks!