My Personal Fan Theory

OK, so this has been bothering me for awhile now, but does anyone remember Wizards of Waverly Place? It was one of my favorite shows as a child but there's just one thing I couldn't figure out.
  1. What's the deal with the Wizard Competition?
    For those of you who are unfamiliar with the show, the Wizard Competition is a contest between the siblings of a wizard family to determine who gets to keep their powers into adulthood. There can only be one, but why?
  2. So here's my theory...
  3. It's the results of a magic peace treaty!
    That is, a treaty between different communities of magic-users.
  4. And it all makes sense because...
  5. Witches
    When uncle Kelbo is first introduced, he jokes that one of his friends is married to a witch, but what is a witch. It can't be a female wizard since none of the female wizards in the show are ever referred to as such. Therefore, witches must be a separate magical community.
  6. The Power of Three
    In the final season, it is revealed that three wizards from the same family can amplify their powers when working together. Obviously, the Wizard Competition is meant to prevent the wizards from using this power against their enemies.
  7. The mortal world is a buffer zone
    My theory also explains why magic is a secret and the wizards don't rule the Earth. It prevents one community from attacking another by surprise. I assume each community has its own pocket dimension similar to the Wizard World.