In my opinion, you are doing exactly the right thing. Ease into the competition at the higher level by going to a few tournaments at the higher division. We used to live in KS when our boys were still 6U and we did the same thing. They were able to compete at State but didn't place in those years. As long as the expecation level is set that you are trying to do the best you can do regardless of the outcome and the kid is having fun...there is little wrong with this approach IMO.