I agree that is where it started, at least for me. Personally I don't think wiping out the other Earth's was really needed.
I can see why you would say that seeing as to how we are RE-CREATING all the Earths again today with the heralding of Earth-2, and Earth 1 coming soon (or so I hear), but back then it seemed like a really good idea because after leaving everything unchecked for decades we had something that would make a house-salad look uncluttered. Too many year of too many characters and too many inter-dimensional crossovers had been mounting and mounting, particularly during an age where the comics-readership was (although starting to change) alot younger than what the age-demographics are today. It just got confusing. Period. It was confusion up the proverbial ying-yang.
I think today (if handled well) we could have a multiverse again without so much disorganization and drama. Today's Earth-2 (so far) is being handled well and actually feels like a separate world. To me, it appears to be clear-cut. I don't know if it's because I'm older (which leads to my original point above about demographics) or if it's because it's actually being well thought-out with intentions to maintain a definite difference in look and feel.