Actually, the Jets might be in the best shape they've been in since, what, 2010? They basically got rid of Sanchez in August instead of waiting until the next offseason. He's out of guaranteed money after this season, and if he's really going on the IR then he's effectively history. Smith can be the starter now and sink or swim without having Sanchez hanging around.
I honestly think you're fucked even if you "win" a QB competition in this league. The team loses simply because therewasa protracted competition. If you're one of these guys with a highly viable backup hovering around the pressure and media interest on the coaches will never go away. The fans never shut up every time you throw an incomplete pass, etc. You have to be the guy who is the undisputed starter to really succeed, which Smith might have a chance to step up and be.
Being rid of the distractions of Sanchez, Tebow, and Revis leaves them in a better place than they were in January, that's for sure.