I think the Chicago and Southeastern Wisconsin area is a good model for how well offering those lower divisions can work. They get huge turnouts in all 4 am divisions and get a much higher portion of players playing in divisions appropriate to their rating. I do wish that the names would go away and we could just refer to them by their division codes like MA1 etc. I think that the rec and novice designations end up keeping people out of those divisions out of pride, and also keep some TDs from offering them out of a sense that "novice" and "recreational" players don't belong in tournaments.
On a collision course with 1000 courses, the only variable is time.