Thanks, Outlaw!
And thanks to you, too, Skip, for clarifying the legal aspects of the situation (as you so often do for us!)
Island Lover, I'm going to startle you a bit.
Now that you've clarified your stance to needing special accomodations such as ample town parking and public docks, I'm with you 100%. Island residents contribute a ton of money to the lakefront towns as real estate taxes; since you're beyond the reach of most town services, parking and docks seem little enough to ask for in return and you folks darned well deserve to get something for your tax money!
Now, as to the 500 HP limit,
that might actually be counter productive with respect to wake size; let me explain my thinking on this.
First, please realize that, for most cruiser owners our boats are our lake homes, and we're just as passionately attached to them as real estate owners and for the very same reasons. We love the lake as much as anybody else (and actually live more closely with it than most!)
OK, let's set that aside for a bit to simmer.
The reason that some of the sedan-type cruisers push the large wakes that upset everybody (including me, when these turkeys send my swim platform through a two foot arc with me on it
) is purely and simply that
they aren't going fast enough to be up on a good plane and are plowing through the water, rather than skimming over it.
In some cases, the operators probably aren't aware of the relationship between getting up on a solid plane and reducing wake size
;
in other cases, the boats are underpowered and simply incapable of achieving a good, solid plane 
.
In either case, the large wake results from the fact that they are plowing, not planing. (You might take cold comfort, as I do, in the fact that under those conditions and at today's gas prices, those boats are moving financial hemhorages; somewhere between 1/4 and 1/2 mpg is a reasonable estimate!
I also comfort myself that Captain Bonehead is truly beating the living heck out of his boat's engines under those conditions!)
Now, to merge the two thought tracks, if a 500 HP limit (truly, not enough to push a good sized cruiser onto a good plane) were to be imposed, people who love having cruisers as lake homes are just going to either buy new ones with legal sized engines or repower with smaller, legal sized engines.
Which is only going to result in more boats that can only plow through the water pushing a large wake, not get up on plane quickly and skim nicely over it leaving a reasonable wake.
Actually, equating large wakes with large gas bills should be an easy, useful, and utterly inarguable idea for WinnFabs to educate folks about, if they care to take on the project.
Granting that Captain Bonehead and his relatives sometimes aren't very big on courtesy, almost everybody cares about the contents their wallet!
Silver Duck