I can see why you are upset about this, I would be too. I feel like this is a life lesson AND it's ok to say something. You don't sound like you are trying to get her moved back or any decisions reversed, you just don't like how it was handled and want them to know that.
If I were you, I might say something like "I understand that as things progress, kids need to be moved around according to skill/staging, etc. Would you mind letting me know if this will continue to happen, or if you are planning to explain this to the kids? My daughter wasn't aware of this possibility and took a big hit to her confidence. If this isn't something that you go over with the kids, I'd like to be able to explain it myself so that she's not hurt again." This is a back-door way to get your point across, while coming at it as a how-can-I-help kind of approach.
I'll share a story that may help you feel in the same boat as others, if nothing else. Last year my daughter was in musical theater at her school (7th grade). Many lead parts went to 8th graders, and the teacher explained that this was normal to give those 8th graders a chance to have a lead before leaving the school. The 7th graders were fine, and figured that the next year (this year) would be their turn. Well, tryouts were held, and many leads went to 7th and even 6th graders. The 8th graders were so upset. Now of course, it makes sense that the parts go to the best auditions, but it wasn't fair that the year before they were told everything goes to the 8th graders and when these kids were 8th graders that no longer applied. My daughter wasn't particularly bothered, she is not serious in the theater and hadn't tried out for a lead. But some kids were super upset, and a few even asked their parents to let them drop the class- and they did! I get being upset, but to let their kids drop this class was ridiculous. It taught the kids to quit when they are wronged or they don't like an outcome.
So be glad that you aren't one of THOSE kind of moms! You are a caring mom who is protecting her daughter's confidence, I think that's great. Do what I imagine you are doing, encouraging her to be the best in whatever place she is given. And just let it suck that she was moved, empathize with her, and she'll move past it when she's ready. Which might well be sooner than you are willing to move past it- we moms always take things harder!! :-) Good luck to you both, I hope she nails her part!