The thing is, at festivals, there are always people trying to make names for themselves. This is completely understandable, but it is the antithesis of what a session should be about. It's tough, but that's the way it is. People are desperate to get attention, they want gigs, a foot on the ladder, whatever, and they can turn a session into their own showcase. So if you happen to fall in with such a crowd, the best thing to do is what you did: walk away.Don't be too angry, people being hungry for recognition doesn't make them behave very considerately!
And good luck with finding some non-competitive, friendly sessions somewhere and somewhen else.