Inbreeding has always been misunderstood by many fanciers in birds and in other forms of livestock.
Inbreeding brings both the GOOD and the BAD to the surface - i.e. the points you want to fix and the points you want to eliminate.
It is all about selection and HARD selection. You need to also select for the traits that are not visible - meaning for vigour, fertility, egg production, longevity etc.
There was a breeder in South Africa many years ago who put a lot of focus on inbreeding because he could no longer import stock from the UK - Dr Alfred Robertson.
If you look up very early copies of Budgerigar World there are some excellent articles printed (a series of three from memory) that highlight his approach, techniques and results.
I will see if I can dig up the issues.
Cheers,
JS
Budgerigar World Edition 33 to Edition 41 Articles by Gerald Binks on Inbreeding.