I think dropping the cut to 25 would not make it easier for young teams to rebuild, and might actually penalize them more than strong teams. The PB cap is a better way to help teams rebuild and make it tougher (though possible) to have a dynasty team.

My logic is:

If you are the league champ you probably have a lineup of strong proven performers. You can cut to 25 and still have your core group and you will have an equal chance at the FA group. Thus the odds are you can repeat or at least contend.
Maybe your starting pitching is:

Curt Schilling
Woody Williams
Roger Clemens
Kevin Millwood
Mark Redman


If you are a building team, you have a lot of "hope he does it this year" guys...

Oliver Perez
Runelvys Hernandez
Dennis Stark
Ben Sheets
Kurt Ainsworth
Ryan Dempster
Rick Ankiel
Jeff Austin

This 2003 spring the strong team could have only saved 5 starting pitchers and been pretty confident of a good rotation.

The weak team needs to save more guys to have a chance that 4 or 5 of his young arms (or bats) will come through this year.

In short...PB cap, yes...more cuts before FA draft, no.

(The examples are from 98RT1 Baltimore Storm & Bement Bulls).