That's to stop people constantly smacking eachother with the pan as it can get quite annoying, nobody wants to hear 8 scouts all with pans just smacking eachother the entire time.
I doubt that the player's item was removed because pan hit noises are annoying. Are you sure there wasn't an issue with Steam at the time? Item servers can be buggy at times and not update your loadout.
I have a mate that has a similar issue as this when it comes to blw Skyhigh servers, his mediguns (an unusual one and an aussie one) do not show, it just equips a stock medigun.
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