Here we go, try a tax_query instead http://codex.wordpress.org/Class_Reference/WP_Query#Taxonomy_Parameters
...
'tax_query' => array(
'relation' => 'OR',
array(
'taxonomy' => 'category',
'field' => 'slug',
'terms' => array( 'event','show_on_front' ),
'operator' => 'AND',
),
array(
'taxonomy' => 'category',
'field' => 'slug',
'terms' => array( 'event' ),
'operator' => 'NOT IN'
)
)