Does anyone tell the truth...

I've never done a pool swim for a race, so I'm not 100% sure how they work it out for the swim, but it sure sounds like you have every right to be frustrated.  Could you have maybe swam a bit closer to them and maybe tapped their toes a couple of times to let them know you wanted to pass?  Could you have been "rude" and forced your way ahead of them?

Maybe you can talk to the race director and suggest a different approach to future races?

If they won't let you pass (did you tap on their feet to let them know you wanted to get in front of them?)  you can usually pass at the wall.  Especially if you are right on top of the person in front of you. 

First, you have to know how that person comes into the wall.  Do they go to the right, left, middle?

Then, as you both come into the wall, start swimming by them as fast as you can, in the area that they don't use.  If they go to the right, you go to the left, etc.  Bounce off the wall as fast as you can, so you are in front of them and then just catch up to the guy in front of you.

I'd never done a tri with pool swim. But during OW Tri swims, if I am swimming faster that the person in front of me I just pass them in any possible way, even if this means swimming over he/she. See, if they felt brave enough to line in front even though they aren't fast/strong swimmers then I am assuming they are willing to deal with the consequences. I think it is common knowledge and sense to start according to your swim pace. Next time, just pass them by any means, after all, it is a race right? 

I've never successfully finished a pool 400m swim in 6:00 but that's what I put everytime.  I useually end up finishing some where around 6:30-6:45 (my record is 6:12 as I recall).  But even though I'm at the front of my age group for my start I still end up behind the slowest from the next older age group.

The way I see it with those pool races is it doesn't matter what time you put in...your always going to be following behind somebody at some point and have to pass.  Some races will be better than others and some just dreadful.

My advice (and it aint pretty):

Swim all over them even if it means getting banged up a bit (this being after you've tapped toes and they still don't move).  Whatever you do, don't waste more than 25m on somebody who won't let you pass...you've got to let them know that yeilding to faster people is part of how things should work.

I came to this determination after I lost 30sec in a 400m swim by 3 slow swimmers side by side for 50m.  I haven't even followed my own advice yet but I did learn from that experience for the future.

I usually don't give others the benefit of the doubt when it comes to swim times.  People underestimate their times constantly and I've run across beginners who submitted their 100m times for a 400m race and then flip out when they realize they're about to thrown in with the sharks.  Others never really do a legitimate 100y/m time trial to find out their approximate finish time.

I'm convinced there's a strategy to deal with this.  Some races have enough lanes in the pool where you only do 1 length and then duck under the ropes.  For these, passing is quite easy since there's no oncoming traffic.  My first tri was like this and I submitted too slow a swim time and ended up getting about 6 passes in for the 500y course (yes...very big pool).

For races that you have and up and back in the same lane, submitting an "optimistic" time for yourself will seed you higher - this goes against the grain though since now you're doing the same thing they are.  If they ignore the foot tap, my suggestion is that as you get about 5 yards from the wall, get a quick little sprint so you pull up even to them at the wall....go 3 wide for a short period of time...open turn at the wall and push off as hard and as fast as you can while you go underneath them taking a long angle off the wall.  As you come up, go easy on the kicking so they don't get a vicious kick to the face (or dolphin kick to maintain speed)

Alternatives -
Grab em by the ankle and haul their ass back behind you.  (I've never done this)
Try to go three wide in the lane and pass em by before you get to the wall....get a good look ahead of you to time it and make sure no one else has the same bright idea.  You gotta be quick, but its doable (I have done this in races and it works well)
If you go 3 wide, sometimes you can squeeze em into the ropes which will cause a quick slow down as you get beside them. (Never done this)

Some of these sounds mean I know, and its always a last resort sort of situation.