CPL-level knowledge is largely worthless to an FI at PPL-level.
However, relevant practical theoretical knowledge certainly would be of great worth. But of far greater importance is the ability to impart instruction, thorough knowledge of the training exercise and sound flying skills, together with good interpersonal skills.
The other problem with inexperienced pilots fresh out of the CPL student world is that they will try to teach people to fly PA28s like airliners; they will have an encyclopedic knowledge of trivia and very little airmanship.
Whereas an enthusiastic, experienced PPL-holding FI will probably have a lot more practical experience, a wider experience of SEP aeroplane operation in the PPL environment - and a genuine desire to instruct, rather than simply to build hours for some 737 co-pilot job.
EASA should expect considerable opposition to their volte-face on this nonsensical requirement for PPL/FIs to have CPL-level knowledge.