Sure, there are two sides. But if the facts are essentially correct, it's hard to see Dragon Con looking good in this situation. If, in fact, there was not a mistake made, or if someone did offer an apology about the situation in the beginning, that would be different, or if they were un-invited for some other reason, those things would change how I would view this situation.
As a private business, DragonCon has every right to refuse to sign them up for a booth next year.
This. Fool me once...Being needlessly jerky twice could be a coincidence, but a third time will definitely establish a pattern of behavior.