As I see it, these bans and rules (in a story-first RP) boil down to a question of trust. With great power comes great responsibility and all that. Can we trust a player we don't know with the scientific power to wipe out systems and travel between galaxies and timelines etc? In a scenario where you have a 100% trust attitude towards everyone else, you'd need no rules. You would trust that, whichever element the other person chose, will only improve the story, not detract from it. Ideally they have also made this choice to reinforce the theme and tone of the story, which was agreed upon in advance (example: all-devouring nanobots in a fatalistic and hopeless future).
Such a scenario is highly unlikely though; essentially, I just described writing without other people, doing it yourself. So if we accept that restrictions on power levels are essentially a gauge of how skeptical you are of your players' ability to write responsibly then... well, then that's what we're looking at. I swear I had a point here somewhere D: Maybe it's a neat, new perspective to view the argument from.

[b]Edit[/b]: Also, what Polybius just said, basically. Any element can work in a story, so long as everyone involved is mature enough not to ruin it, as catchamber put it. But if you're with a lot of people you don't know and you don't want to risk it, or you're skeptical because you had one too many powergamers, then setting defined limits is probably the way to go.