That is such a ludicrous rule. Does that mean that if you have a picture on display of a bunch of new members proudly wearing their NM pins, it's a rush infraction??

Like AZ-AlphaXi said, what if you have new members when rush takes place? Or suppose a sister misplaces her badge and just wants something to wear at pref?
Some AEPhi chapters let you keep your NM pin, others don't. Mine did, and although I don't really have occasion or reason to wear it, I'm glad I was able to keep such a pretty piece of jewelry.
My local sorority had pledge rings instead of pins - so it was quite easy to wear both your ring and your badge if you wished.
AXO Alum, I think you could make the argument that your NM pin "becomes" part of your badge. You don't necessarily stop wearing your engagement ring when you get married - a lot of people wear the two together - and it sounds like this is the same type of thing. You may win your case if you agree to wear your NM pins only with your badges, not by themselves, during rush.