I think different cars were targeted at different markets. For example a Chrysler would be the more luxurious model, a Dodge slightly more sporting and a Plymouth would be the value alternative. Though, there seems to be less of a delineation between Dodge and Plymouth so maybe I'm wrong there.

Certainly, with the BMC and Rootes badge engineering it was largely because of this. If you look at the ADO16 series the different versions were aimed at different people. The MG was the sporty one, the Wolseley and Riley models were more luxurious, Morris and Austin were aimed at the lower level. People who would buy an MG wouldn't be seen in a Wolseley or an Austin and vice versa. It's no different today as if you want a Golf you can have it as a Golf, an A3, an Octavia or a Seat Leon. Okay, the cars have different shells now, but the principle is the same.

As for why they are destroyed it is because they were cheap. These kinds of cars were used extensively to fleets and were sold off cheaply after two or three years. It's also more realistic if you are making a cop series for police to use such cars rather than something that the police ordinarily wouldn't use. Also, I guess cars like the Caprice, St. Regis and LTD could take a lot of punishment and were rear wheel drive making them well suited to those drifty car chases 80s US series tended to have.