"I have read before and have read on many other forums about adding genetic diversity to captive breeding stock with new blood, or wild caught and collected snakes. My question, is this really that big of a deal?"

Yes, it is.

"What has happend to the CB animals that have been bred without any new blood comming in?"

It generally tends to result in a wide range of minor to severe defects. Below average growth rate and adult size in many "high end" Cornsnake morphs. Bug eyed leucistic Texas Ratsnakes. Albino boa's born with one or both eyes missing. Scaleless Texas Ratsnakes. The list goes on and on.

"What about an isolated area in the wild, where a certain species of snake has little genetics to choose from? There would be crossbreeding going on in nature in these isolated areas would there not? What about an island where one gravid female makes a swim and her and the babies beocme established would this also not include crossbreeding between siblings?"

Inbreeding definately also happens in the wild. Fortunately, there's also this thing called natural selection.
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