I'll offer my opinion as an Am...
I rarely play well enough to be able to compete with the better Pro/Open players. Having the lower division, despite what you call it, allows players like me to still enjoy the experience of competing in league while having a chance to get a little something in return on a few occasions. Even if it is just a few bucks of KC Cash. If we're all thrown into one division, players like myself are almost guaranteed never to get any monetary return, fake money or otherwise. I understand that the natural response would be "Well... get better so you can compete." But if I can be thrown a bone once in a while along the way, by means of KC Cash, I'll have much more motivation to continue to participate. I see the lower division as a stepping stone to the upper division. A way to learn how to win, while bettering my game at the same time. That's a good feeling. If the lower league were not there, weekly league for me becomes a $5 butt kicking. It might sound silly, but that chance at KC Cash brings me back. If it were 1 division with little chance for me to ever see any return throughout the year, I don't know if I'd bother with league.