I think the problem lies with the duality between defining "contemporary" as a relative function of time, versus the said term as descriptor for certain stylistic devices that appeared in music of the 20th century. The fact that at some point in time these two meanings may have coincided further compounds the problem. It is clear that there are those who have a difficult time relating multiphasic meaning towards a particular term of like spelling (I would relate this as similar to a person with perfect pitch unable to hear the notes of a transposing instrument). Nonetheless, I feel what is needed are a clearer set of discreet terms for these points.
***
Do what the audition asks of you. Audition time, as well as course time are not the best places to be making political stances. If you want to voice your beef do it on your own time, not during an audition and not during lessons. There is no requirement for you to continue to do what your teacher asks of you.
I agree. The 20th century has been labelled with many genres, of which contemporary is not one. Rather, they have been Impressionism, Expressionism, Electronic, Twelve-tone, Serial, Post-serial, Neo-classical, Modernism, Post-modernism, Minimalism, Chance Music. Among others.
If I go to a concert labelled Contemporary, I'd not hear Debussy, Ravel, nor Schoenberg nor Stravinsky. Neither would I hear Prokofiev or Schostakovich. I'd hear freshly composed music. The pieces might be a few years old, but they would not be as old as 1980.
Contemporary means new music relevant to what's happening now on the composers' scene, not what happened 20 or 30 years ago or more.
The dilemma with labelling such a category in an audition is that it likely doesn't correspond to what it actually means. It would probably indeed stretch back to 1950 as suggested, or further.
Was I in such a jury, what I'd like to see is a performance of something that differs in terms of structure/technique/musical language/notation from the, for lack of a better term, "baroque/classical/romantic/impressionistic/neo-romantic/neo-classical" canon, with by which I'd mean Bach/Mozart/Beethoven/Chopin/Liszt/Debussy/Ravel/Rachmaninoff/Prokofiev. I wouldn't be a stranger, although it would certainly not be "contemporary", to Schoenberg/Webern/Berg/Cage/Berio/Feldman/Boulez/Ligeti/Gubaidulina/Schnittke. These are but a few of the more established and universally acclaimed, by now "classic", 20th century composers (most of them are long since deceased), not least for their compositions for piano. There are many more, but these are certainly among the most acclaimed of the avant-garde, i.e "breaking-new-ground", composers of the last century.
Auditioning with any of these would give a hint that you have some orientation in what could be called a more contemporary "structure/technique/musical language/notation". Personally, I've played some Schoenberg and Schnittke, worked on some Webern, Berio and Feldman, fell short of working on some Cage because I didn't have eraser-gums and screws at hand to put on the strings, and I've premiered two new compositions at concerts. Not a lot by any means, but...
Anyway, my thoughts on "contemporary" at an audition.