There is nothing wrong with travel/tournament ball in and of itself. A seven year old tourney team seems kinda stupid IMHO but whatever.
What worries me is the explosion of teams/clubs over the past ten years and the relative lack of any kind of regulation of these teams. The money involved, in some cases tens of thousands of dollars is attractive to con men and shucksters and there is absolutely no regulation of who forms these teams, what qualifications they hold or any verification that the people working with these youths are qualified to teach anything to a kid, much less baseball.
There is little a parent can do when a con man takes your money. We have had several incidents in our area alone where someone comes in, claims to a former pro player, scout or whatever only to find out that the guy was a con man. Parents often have plopped down some significant money to get very little in return. In some cases legitimate baseball facilities have agreed with these con coaches to train these kids only to lose the money owed to them because the 'coach' skipped out with the money. Parents get promised a lot, are pressured into signing a contract but find out that it is worthless when the crook takes off and gives them nothing.
What is even scarier is that in many cases there are no background checks done on potential coaches, nor is there any kind of governing body that really has any kind of control over teams. Many of us have seen coaches that have had no business at all mentoring young ballplayers, or any youth. There is a potential for abuse that is currently not being addressed and this is what scares me. How many parents have actually sat down and asked an organization, 'Have you done all of the necessary checks to make sure a sexual predator hasn't signed on to our team?'
As a scout leader and a youth leader in my church I had to go through an extensive background check before I could interact with the kids. When I was a coach in PONY I had to do the same. There are checks in place for PONY, LL, and Cal Ripken. I don't know of any for tournament style ball. And these are the types of teams that are at highest risk, they travel long distances, the kids spend a much larger time interacting with a coach and there is a much greater risk of abuse.
I don't know of any mandated checks necessary to coach or participate in travel ball. Maybe someone can clue me in on other areas but I don't know of any certification or standards that are in place for coaching select or tourney baseball. We talk about baseball knowlege but I am as much, if not more concerned about the risk to youth from inappropriate individuals gaining access to our kids.