Sorry, this is going to be a wall of text, thanks for the thought provoking post though.
Yes, I think I agree with your argument, provided that my understanding of it is accurate. It seems that you make two main points and one corollary. First that evolution requires us to do a sort of evil, to harm others to benefit ourselves in order to thrive. Second that ‘nature’ or god has imbued us with the capacity for evil so that we may appreciate goodness and exercise choice. While I agree with both of these, I do not agree with your corollary that God is subsequently not justified in punishing sin.
I would disagree somewhat with your characterisation of competition as necessarily creating a loser or doing ultimate harm, not every game is zero sum. It is entirely possible that you beat me but that we both gain.Trade for instance is a common example of this. I think though that this might be in a sense what you are arguing, that to do good in a broader sense sometimes we must do evil.
On the whole though I think you have a point with the evolutionary side of your argument. Going through life with the goal of never besting anyone else would lead to a pretty miserable existence. You would never be able to take a job with other applicants, never be able to enjoy the satisfaction of succeeding in sporting endeavours, and never be able to sleep with a woman desired by other men (lord knows what such a limitation would mean for your alcohol consumption as well).
So not only would non-competition create the least fit, it’s hard to see how it would create anyone at all. In any species such meekness would be extirpated from the gene pool within a matter of generations.
As for your more abstract conclusion, I agree once again. Although I don’t think it makes sense when creation is ascribed to nature. I don’t suspect that the process of evolution was particularly concerned with our capacity for free will. However, if I were to view this in the religious context of the rest of your argument I think it is an extremely interesting point.
Whether we need imperfection to appreciate perfection I do not know but suspect to be true. What is clear to me though is that without evil (in a broad sense) there is no free will (or at least the illusion thereof). If all choices are equally good in an absolute way there is no choice, no actual differentiation between options. If one were to then imagine a world where all choices are absolutely good bar one, that one must seem an evil to be avoided at all costs by every denizen of such a world, no matter how ‘good’ or ‘bad’ in absolute terms it might be. Thus, to allow for free will, the capacity for choices that lead to or create suffering must be preserved. The greater the levels of gradation between the ultimate good and ultimate evil that can be attained, the greater the capacity for individual choice.
I wonder if you, as a christian, have been witness to the classic argument disproving god that ‘an omnipotent and omniscient god would not allow for suffering if he cared for the sufferers’. To me, the preceding is a strong rebuttal to that notion.
Finally, I would say that all this necessity in a systemic sense does not exculpate the sinner from his responsibility. While the capacity for evil must be preserved for the good of us all, under this religious view individual evil is enabled, not enforced. We may blame the creator for our capacity to sin, not the actual sins we as individuals choose to undertake. I think it is important here to call to mind the difference between an act and an actor. While individual acts of evil may provide some greater good in a systemic sense, that does not ameliorate the malicious intentions of an actor who had no desire to cause any broader good whatsoever by his act.