qaws, you’re asking a VERY good question. Administrators grapple with this question regularly. The basic geder most of them hold of is that a chinese auction should offer small prizes that don’t promote someone to a new level of gashmius, but nothing over-the-top. Glossy booklets with dancing dollar bills bouncing next to prizes seem way over-the-top. It turns the tzedakah into a “parah adumah”, purifying the impure but sullying the pure. The retracted Lakewood chinese auction from a few years is an example of an over-the-top chinese auction that got pulled when the Yeshiva hanhala realized that the auction was counter to the ideals the yeshiva was pushing. I know some yeshivas don’t hold them because they feel it promotes gambling. there are also asmachta problems when young people put in tickets sure they’re going to win.
The YCT one doesn’t seem over the top, and the administration there always try to follow daas torah, even when it hurts them in the pocketbook.