The classpath exception allows your scenario to have a GPLv2-incompatible license, but the license for the scenario cannot place requirements on the Greenfoot code that would conflict with the GPL. Bearing in mind that I'm not a lawyer: My understanding is that if you were to use GPL v3, it requires that everything your scenario is linked with also be covered by the GPL v3 license; you can't do this with Greenfoot scenarios because it causes the Greenfoot code that you distribute with your scenario to be covered by the GPL v3 license, which is incompatible with the GPL v2 license. You could probably use 'GPL v3 with a classpath exception' if such a thing exists. It might be possible to use an even more specific 'GPL v3, with the exception that the Greenfoot code is not restricted by the GPL v3'. There is something else that may be pertinent. Licenses can apply both to source code and to the resulting binaries; In the case of the GPL (v2 or v3) applying the license to the source code also causes the license to be applied to the resulting binary, but this requirement is mooted for the copyright holder (i.e. you do not need a license to do stuff with your own code). So it is possible to make your scenario source code available under the GPL v3 license and, assuming that you otherwise hold the copyright, you can distribute the binary under another license (so long as you comply with the terms of licenses that you are otherwise obliged to). The only complication is that no-body else will be able to distribute a binary produced from your source code, since they would be forced to apply the GPLv3 license and this is impossible, as discussed above, assuming that they link with the GPLv2-covered Greenfoot code. With that in mind, you might want to to talk to the organizers of the competition to clarify the rules, i.e. does the GPLv3 requirement apply only to the source code of the game or must it also apply to the binary? You may wish to tell them specifically why this is an issue for you and see what they say. Perhaps they will accept dual-licensed source (GPLv2 + GPLv3) with the proviso that binaries are covered only by GPLv2.

Sorry if that was confusing. Having had some sleep, my mind is suddenly clearer, and I re-read your original question :) In specific regard to your question: Then, yes, the code in Greenfoot starts with text which says: This program is free software; you can redistribute it and/or modify it under the terms of the GNU General Public License as published by the Free Software Foundation; either version 2 of the License, or (at your option) any later version. I think this means you're ok to use the GPLv3.