Having all the primaries on the same day, while fair, would remove the folksy aspect of primaries. I think that's a pretty good part of it.
I think having the primaries spaced out over a month of two achieves two useful things…
Firstly it forces candidates to go through a potentially tough and gruelling campaign which helps to weed out those who simply don’t have the stamina, temperament or “beef” to compete in a general election, witness Muskie in 72, Hart in 84 and Dean in 04.
Secondly it forces candidates to campaign amongst a broader electorate than simply those ideologically committed to them and helps them to be more competitive nationally, if Utah decided the GOP nominee and Vermont the Democrat it would be a pretty unrepresentative system wouldn’t… you’d end up with an election pitting Tom Coburn against Dick Durbin
Personally I think West Virginia (or maybe Kentucky) would benefit from having it’s primary being pushed forward, I mean it helped get Kennedy nominated in 1960 and it provides a useful populist bellwether follow that up with somewhere like New Jersey or Washington and then have a big sweep of contests like the first super Tuesday in 2004,a couple of southern states together with a few in the south west and Midwest… I wouldn’t dump Iowa and New Hampshire out of hand though, especially New Hampshire.