How come the directors of El Mariachi or Paranormal Activity didn't submit to those first? Or did they and they didn't well?
Specific to El Mariachi, the intention was never for it to go to film festivals. It was made specifically for the Spanish language home video market. He had a short film called BED HEAD that was playing at festivals at the time quite a bit....El Mariachi DID play at the Toronto Film Festival. That's where the historic meeting between RR and Quentin Tarantino happened. It didn't hurt that Columbia had already picked up El Mariachi first and sent it there with a 35mm film print.
You really need to read his book REBEL WITHOUT A CREW. All of this is in there.
And Paranormal Activity was discovered by Spielberg's assistant at the 2007's Screamfest Horror Film Festival, and brought to his attention. It was rejected from Sundance. Twice.
**** EDIT ****
EL MARIACHI Festivals
September 1992 (Toronto International Film Festival)
January 1993 (Sundance Film Festival)
February 1993 (Berlin Film Festival - Panorama section)
February 1994 (Fantasporto Film Festival)
PARANORMAL ACTIVITY Festivals
October 2007 (Screamfest Film Festival)
January 2008 (Slamdance Film Festival)
October 2009 (Pusan International Film Festival)
October 2009 (Dublin Horrorthon Film Festival)
November 2009 (Oslo International Film Festival)
November 2009 (Festival Internacional de Cinema Negre de Manresa)