It would certainly allow the game the opportunity to fill the houses with living sims. I think the restocking takes place once every sim week and the households are filled by the game looking at how many beds there are available in each house and 'choosing' the Not in World sims to be placed there.
I wish that EA would fix this too... it really brings the game down.
The only other way to fix it is to start merging living sims with ghostly households or even filling the houses yourself... but that could become a 'pick your sim' kind of fix which feels very much against the tone of this challenge. You would need a set of rules about how to do this.
I do believe that the evicting of ghosts would go some way to partially solving the "I have no neighbours" problem and the culling of friends.
Either way this problem is going to be an on-going problem until EA fix it. I don't know what else to suggest really.
(*Edited: Sometimes there can only be ghost sims in the Not in World category too... in which case evicting resident ghost sims will probably do nothing as I don't know if the game mechanics actually 'make' new townies.)