does there come a point where that strategy no longer makes sense
Yes. It does.
Let's say you have 4 cards, and another player on the map has 4 cards too.
Let's say everyone has around 30 troops each, and spoils are worth 30 troops. Then it make sense to use your set with your 4 cards, then you get 30 troops and have 1 card, and if you kill this other player with 4 cards, it will make you have 5 cards again, and you can directly cash 35 troops and maybe kill another player.
Same story if you have 3 cards and another player that you can eliminate has 5 cards.
Usually you should do that if you can recash for each player you kill and then kill everyone in one turn, or at least take a very significant lead by killing 1 or more player in this turn.
The whole strategy in escalating is a question of timing, you have to chose the right moment to use your card, and chose the right moment to be able to win the game in one turn.