By the sounds of it you were on a Demo server racing FBM(could have already been established but I don't have time to read), If that is the case then you should really expect that, I have only came across one good Demo server, which was Blackwood XFG XRG, but there were still some wreckers on there, but the regulars made sure to get them out.
As for the blue flag situation, I fully agree, You have 3!!!!! warnings to move for leading cars in real life, so why on earth should you be made to jump out the way, possibly causing more danger to the passing cars, as soon as the first flag is shown?
That's why I like the airio set up on [AMG], 5 blue flag warnings then spectated or kicked, I can't really remember.
As for fair racing, you should try FM FOX, really good, mostly clean stuff there, and there is always some friendly guy to help you out with a set, which by the sound of things, you need.
If all this has been mentioned previously, then sorry for the spam!