Hi Slobodan;
Well, I am a lawyer, although I have litigated more trademark than copyright stuff in a prior phase of my career. The laws in Canada, US and for that matter most common law countries throughout the world are pretty similar. There is generally no copyright law prohibiting photographing of private property from public property (there are very rare exceptions, usually dealing with national security). There MAY be restrictions on unauthorized reuse, but generally that prohibition would be stronger coming from the Fair management side as an implied term of your ticket purchase, not the exhibitor.
In this case, the guy is clearly a deranged nut bar. If I shot a photo of his, ahem, "art", and he tried to grab my camera on the basis of his warning sign (hint: a good sign you are dealing with several degrees of crazy is to look for the word "conspiracy" somewhere in the warning, and the sign is laughable, BTW), I would likely be able to file a criminal complaint seeking to have him charged with assault, threatening, AND sue him civilly for same.
If the fair had a general prohibition against photographing the exhibitors, that could be a term of your attending, and then only maybe, in terms of prohibition. Think of the usual restrictions on carrying a big camera into a rock concert for example.
So, snap away, and tell the guy to go and **** himself if he continues to hassle you.
Leigh
zippski