There's absolutely nothing wrong with a PP flying an LSA, Jim, as long as he or she receives proper transition training (which one should do in
any new aircraft, as all are different). I agree with all the advantages you list, except "better instruction," which I maintain is available to SP candidates as well!
Bear in mind that the night and lower visibility privileges require you to keep your medical in force. Many's the PP or above who let the medical lapse. Those folks are still Private, Commercial, or Airline Transport Pilots, but are restricted to the same limitations that apply to Sport Pilots (with the exception of the airspace endorsements).
One advantage you left out is the ability to fly VFR on top. Those exercising Sport Pilot privileges are required to always have visual contact with the ground, which is a major limitation when flying XC. (OTOH, unless you are absolutely sure there's a hole to descend through at destination, VFR on top can be a trap.)
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The opinions expressed in this post are those of one CFI, and do not necessarily represent the position of the FAA or its lawyers.
Prof. H. Paul Shuch, Ph.D., CFII, LSRM-A/GL/WS
AvSport of Lock Haven
http://AvSport.org fly@AvSport.org