I think it is a good practice. Any litter I have seen with limited registration also includes verbiage to the effect if you do health testing and train dog to a certain level full registration will be granted. Limited registration only effects you if you intend to breed, if you don't breed who cares. And if you plan to breed you should only do so if your dog has the potential to improve the breed. IE Has all the breed specific recommended health clearances, and has proven ability's.
I will not breed my stud dog for litters without limited registration.