I SO agree that horses have to experience the real world so that they can be reliable mounts and safe equine citizens. However, I have often found that the monotony of arena work and the "newness" of every show venue provide distinct challenges that a horse can only learn to manage if asked to perform under those conditions. Our two youngest mares do great out on the trail, but when we start on arena work, it is a whole new ballgame. There is a lot more to benefit from in a show environment than just the placement your horse may or may not earn.
I once rode an absolutely wonderful mare for a friend. She had been trained as a 3 year old and her owner was too afraid to get on her, so she sat in the pasture until she was almost 5. I was asked to put some miles on her and the first month I thought I had made a mistake - I was only 14 at the time. I took her to as many different events, trail rides, etc. as I could, and she became absolutely wonderful and would go anywhere I asked, even if she wasn't sure about it. I was sad to give her back to her owner!