Let's be real--what you are really doing is attempting to win a POOL game rather than develop your players.
SO:
If my DD was the #2 pitcher and you did this to her, this would be the last year she would ever play for you. It might be the last tournament she ever played for you.
Why? Because the #2 pitcher has worked her a** off all year pitching in the shadow of the #1 pitcher. The #2 finally has a chance to go out there against the best there is and show what she can do, and you are taking that opportunity away from her. The only way the #2 can convince you and the rest of the world that she is better than the #1 pitcher is to pitch against teams like this.
And, apparently, the #2 will never be able to prove it--because you won't let her. You are taking the internal competition element out of the game.
My DD was proud of her pitching, and she thought she was the best pitcher in the universe every time she went into the dugout. She didn't think there was a better pitcher than her in the entire United States--which is one of the reasons she ended up pitching D1. She would have taken this as a personal insult--even at 10YOA. As a Daddy, it would be like you coming up an p****g on my shoes.
My dd was the #5 pitcher last fall and is currently the #2 pitcher on her 10u travel team and I can tell you with absolute certainty that packing up my dd and going home was never an option. To my knowledge no parents on the team who were higher in the pecking order last fall and are now only pitching in pool play and friendlies are threatening to pull their kid from the team. If we did have one of those, I think we'd all be relieved to have gotten rid of the 10u crazy daddy and his circle princess.
That said, and pitcher's and their parents egos aside, if you put in a pitcher who's got no chance against a top team it may send the message to the entire team that you're throwing in the towel on the game. I might be inclined to approach a game like this with the idea of throwing a slower pitcher than my #1, but one who's poised enough and accurate enough to hit her spots and keep the ball low in the zone.