Sometimes you just need more reps in order to build chemistry. It also helps to get a variety of different looks and personal to go against, which is something you can't easily replicate internally. And while I do think, in a vacuum, that playing better competition would maybe yield faster results, there's a bunch of potential negative consequences too. Not only could you potentially scuttle your tourney hopes before you even hit conference play, you could also damage the confidence of a team that's got a lot of young, new pieces.
Personally, I think easing the team into it with mostly cupcakes is great, especially when you punctuate that with an occasional good opponent that you can really get up for.