I agree with Calvin that good competition at many levels does improve shooting and raises the level for everyone. In New Brunswick, matches at Petitcodiac are of this nature and you will see mostly serious competitors with serious equipment there. We still score up though and so matches are sometimes won by Xs.
On the other hand, local clubs and local "fun" shooters are the grass roots of our sport and rimfire shooting is a relatively inexpensive and low-maintenance way to get them involved. I'm all for increasing this and if some clubs stay away from higher level competition to do that - kudos to them.
We all know that gradually, over time, the level of shooting increases, the equipment becomes more sophisticated (and expensive), and methods (including rules) become more standardized. So I see some stiff competition, first regionally and then perhaps nationally, on the horizon.
Perhaps we could start mail shoots such as the DCRA has been doing with the rimfire prone shooters as a good first step.