The two tools are essentially two different approaches to the same goal.
The Toolkit's script manager aims to combine every available JS file, across the entire site. The benefit here is that it's easy to set up - you replace the ScriptManager and let it go. The downside is that unless every page uses the exact same set of scripts, you will force your users to download excessive amount of script code. If your homepage uses scripts A,B,C,D and an inner page uses A,B,C,D,E, then when your user hits the inner page, they'll have to redownload the contents of A,B,C,D because it will be part of a different combined script resource.
The CompositeScript feature is meant to be very picky about what scripts it includes. The developer must analyze what scripts are utilized on every page and add them to the combined script. In the previous example, you could select (in a master page, preferably) for A,B,C,D to be combined, but not E. Then your user would hit the homepage, and download A,B,C,D in one shot. They would then continue to the inner page, would already have A-D in their browser cache, and only have to download E.
So as with many things, it depends upon your architecture and how much effort you can afford to put into it. These both seem like extreme approaches, one from the side of include by default, one on exclude by default, and there doesn't seem to be any middle path. (How I wish there was one.)
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