Personally, I started looking through it a little closer when I compiled the prestige class index handbook.
Some of the material, like the feat Child of Earth, are quite powerful, but looking at a lot of other "1st level only" feats, it's arguably on par given the restrictions.
A good majority of the prestige classes seemed very uninteresting.
So, I've never seen a complete reason for Kalamar's loss of a license, and a good reason to retroactively disregard those books that were produced with a license.
I can understand not wanting to use them, as the books are obscure to many, that's simply the DMs discretion.