Rick, it sounds like you "get it" and the Dirtbag coach doesn't; simple as that. You are doing the right thing.
You have also reaffirmed my notion that the worst thing about coaching little league is the parents. Too bad you're seeing this at such a young age group. I can assure you that it only gets worse as the kids get older, and the (parents) get more competitive. Have fun, but more importantly, make sure the kids are having fun.