Should Society handicaps be realistic?

Our Society has 75 members and create a std scratch for the day dependent on numbers competing. Generally it is one shot lower than the top five players.

We generally play from the yellows, so handicaps should be lower than club handicaps. Mine is 11.3 compared to club being 13.8.
We have a mix from plus 2 to 28.
 
Our society calculates a CSS for each round and cuts increases accordingly by 0.5. The winner gets cut 3 shots, it works quite well. At the end of the day it is more of a social thing than anything and the prizes are only a couple of bottles of wine which is nice to win but not a huge disapointment if you don't. To play in our society you have to be introduced and play a certain number of events a year to maintain membership. Guests are allowed but there is a separate prize of 1 bottle of wine for best guest.

The problems tend to come in other societies (as far as I can see) when either too many randoms rock up off of dodgy handicaps and\or the prizes are of value. I wouldn't be playing in that kind of society.
 
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