It works from both ends.
Presently competitive teams will like being able to keep 22 players, instead of 20.
Presently rebuilding teams will like being able to keep 14 or 15 prospects, instead of 12.
In the DDL, rebuilding teams tend to promote and MLB keep a couple of prospects anyway. This isn't ideal because it makes MLB teams a bit worse, so the league is a bit less competitive, and it also significantly hurts the value of those prospects.