> so much more effective than exercises on particular sections

Effective at what though. Just passing the test?

Do the students actually understand the material? Can they apply it to novel (to them) situations?

When I was studying physics ('74-'77) a significant number of students who all had just as good test results as I did in senior high school dropped out after the first term because they just couldn't manage the material. They had learnt enough to pass the exams (British A-levels) but had not really understood and had not practised enough. I suspect that rise of modular courses might make this situation even worse but that might be prejudice on my part.

Specifically wrt to tests like SAT, GMAT and other type of admissions testing, I believe the idea of practicing on the test as a whole is to allow you to get better at "strategizing" your time thereby maximizing the number of questions you could attempt. This paper seems to talk about a different concept.