Chris K,
There are 2 forms of sponsorshipin most sports/hobbies:
1) Full ride- sponsoring company provides all equipment and also pays for race entries, travel expenses etc. Normally reserved for your big name people that have proven winning background
2) Partial sponsorship - sponsoring company offers discounted pricing on equipment and parts etc. Guys that are good on regional or local levels.
This is actually Indirect marketing as the product or service is still going through a dist channel (Horizon, Great Planes, Kyosho America, etc) and then to a local or On Line retailer and ultimately the consumer. Direct marketing is when you market and sell your product directly to consumer, this usually is unsolicited and in the form of email, junk mails, etc.
In either case, the sponsors are trying to attract other consumers by getting their products in the hands of the "fast guys" and in this hobby, everyone likes to mimic the fast guys so if they use XYZ motor and win races, consumers will associate XYZ motor with being a race winning motor and they will buy one. I don't see how this is diminishing the hobby but instead growing it! THis is a marketing technique used in many other industries and has proven success. Either way, the fuel on this thread is sold and its time for everyone to shake hands and move on!