See my opinion is that it does nothing for removing the excess. I literraly don't see how it helps, cause how i said trully useless players will retire regardless of their price. I've tried to sell useless crap multiple times for a 1k, and got no bids for it.
And generated star players are better than rookies cause you can use them to fill the positions that you will not train and they will preform better in the clutch because of the experience. And that allows new managers to be more competitive on a lesser budget while they are building their economy for the first few seasons.