Format won’t disqualify a writer, then, but does it affect a script’s chances at a full read?
Yes. Some degree of professionalism is expected. A grossly out-of-format script will almost certainly not be read cover to cover. Furthermore, if a manuscript looks and reads like a stage play rather than a screenplay, it’s not going to fare very well, because the Nicholl competition is not a playwriting contest. There are undoubtedly talented people oblivious to formatting issues who take a stab at screenwriting and turn out terrific scripts. But a reader who picks up an entry that looks nothing like a script does not anticipate one of these exceptional reads, but rather one that will be tedious and even painful. That initial resistance is almost impossible for a script to overcome.