I am Australian, and so I write my articles using Australian English, which is pretty much the same as British English... somebody just came along and re-edited one of my articles, changing most of the terms over to US English and removing the Australianisms. I know that most Americans wouldn't have a clue what a 'milk bar' was, but does that mean that I should NOT use the term in any of my writing? Australians use the internet too!
What is the policy on language?
It's best to deal with things on a case-by-case basis instead of dealing in generalities where possible. What article was it?
To speak in generalities, the policy on language is pretty much the policy on everything, which is: as long as what you do a) stays within the mission of Wikipedia and b) doesn't upset other Wikipedians, it's totally fine.
So the #1 policy is to not upset other Wikipedians unnecessarily (and to try not to get upset over minutiae). If someone edited your article so that it's understandable to a wider audience without eliminating information, then that was a good thing. If they removed information, that's not so good.
If as an editor there's something which confuses you, you should use the "Talk" to ask what's going on before editing.
Re: variants of English--feel free to write with whatever spelling you prefer. We don't have any policy as to preferred spelling. See http://www.wikipedia.com/wiki/wikipedia%3AOther+Frequent+Questions
Q. American English though, I presume, not British English?
A. Why presume that? People are writing in all sorts of English. This isn't necessarily a bad situation, either. Anyway, of course, the Americans aren't going to adjust their usage for the Brits, and God knows the Brits won't adjust theirs for the Americans.
--tc