If you believe that money raised through raffles, auctions etc. etc. have any positive impact on Sheep populations then you don't want to ban non-residents. I'd venture to guess that a HUGE part of that $$ comes from folks who don't reside in your great state, tell them they can't hunt sheep and you can say bye bye to that $$.
That said, I don't necessarily disagree with you. Hell, the hunting in Idaho would be amazing if we'd just ban non-residents all together, so I could get behind a "Hunt your own state" law.