I guess they can as long as they follow the rules of the contest. They may generate more crowd to join if they know a known streamer is trying to join the contest. Most gamblers find it amusing this way and it's good for casino as well, better to allow them rather restricting them.
That's for sure, I can also imagine that some streamers are paid extra to advertise the contest by playing directly. As a casino you can hardly reach a similar range otherwise, such streams have thousands of viewers, that's quite a lot. Even if only a fraction of them feels addressed and participates in the contest because of the stream, it's worth it for the casino.