Personally I don't think there is anything bad working as a Cruise Pilot for a year or so, there is a lot to absorb working in a commercial heavy jet environment without having to worry/contend with the flying bit too. it a gentle exposure that certainly helps (please bear in mind, you still have to do the full TR course, pass it and any subsequent OPC/LPC's). You are fully conversant with the aircraft and can easily perform the function of PNF in an emergency if another pilot is incapacitated.
Cruise Pilots exist because they facilitate current regulatory requirements about flight time and rest. A few years ago airlines made do with 2 pilots who managed their own rest/sleep patterns. Now its felt that 2 fully aware pilots are required during all phases of flight (even flying a over an ocean and position reporting every hour).
I thought I had absorbed enough from the third seat after 6 months, however my time to upgrade wasn't up to me. The only thing that should be insisted upon by the union/regulatory authority is that the cruise pilots hired should have a definite upgrade/promotion scheme in place with the company. Or do what the company I worked for did, fly 767 as a cruise pilot then after serving your apprenticeship move down the 757 (which was also in their fleet).
Virgin are adhering to the rules set out by CASA and doing this in the cheapest way possible (by hiring cruise pilots), as a commercial operation it makes good business acumen/sense to do so. However it is worth remembering that every cruise pilot has already paid the best part of AUD200,000 to attain their licence to be in a position to provide that cheaper alternative (opposed to employing a full FO) to the airline. The have also went into further debt by agreeing to be bonded on the 777.
As a result it would be nice if the chief pilot/ops director kept this in mind and rewarded them in the future. It's a shame in the current economic climate the balance sheet has the power.