im not sure that im right, but in my hear second version is "more" right. The first one "очереди за едой стали слишком длинные" gives more focus on "очереди за едой" as main the thing in the narrative. So, the nominative case gives more attention to the specific detail, then the instrumental case. So, the first variant is ok, if you want to tell about definitely queue, maybe it is same as to say "the queue", and other cases give "a queue". But the sentence has three parts : когда я пришел на фестиваль - 1, народу было не очень много - 2, но позже очереди за едой стали слишком длинные - 3, - it looks too long for a message about "очереди за едой" and looks boring because contain also information about self. But if you use the instrumental case, the story's focus moved from a queue to self, and it has become a story about self, not about a queue. Also, you can continue the story(about self) after, but if you use the nominative this story looks as complete message.
Его глаза стали широкими, как блюдца - story about him
Его глаза стали широкие, как блюдца - story about his eyes