Continuing to have the VQ is better for guests who want to avoid a line, definitely. It's not so good for operations/overall park capacity when they're sending empty ride vehicles, and it's costing Disney money in ILL sales.
It's also bad for people who'd like to be able to ride it several times in a day.
The VQ is so easy to get, though, that it's likely depressing ILL sales. It's not like all VQ spots are gone in seconds; if you want a VQ spot you can easily get one with no hassle.
If it was standby only, more people would buy an ILL to avoid waiting in line for an hour+.