A bit late joining this discussion but at Helidays the organisers have local authority permission and the pleaure flights operate just below the high tide line...it goes a loooong way out !
It is outside the congested area...i.e. roped off and with no significant numbers of people etc being overflown but this year the main event on the nearby lawns has been deemed to be within a congested area and the CAA has granted an exemption to Rule 5 subject to certain conditions.
I have seen microlights and auotogyros doing touch and goes from a nearby quieter beach without permission but still believe that local authority permission is needed .