The reason that there are grade based tournaments with no age restrictions is that there are a lot of clubs that want to play under those rules (or lack thereof).

No one forces a club to play older teams. You either pick a tournament and a bracket where there won't be over age kids or you don't. Avoiding the AA bracket of highly competitive tournaments pretty much eliminates the problem.

The only reason there is an issue is that parents and club directors want the bragging rights of saying they won in the highest brackets and in the best tournaments. If you focus on making sure your child is playing at the level where he has the most fun and skill development than there isn't a problem.

If you want to say he played at the highest level in the best tournaments than be prepared to play with the big (and maybe older) boys.