Much better. Sorry, I was a bit harsh before.
Your understanding is much better now. However, I must point out that no one puts a gun to a grower's head and forces them to enter a contract with Monsanto et al. Many people complain about not being able to save seed, but corn growers haven't been able to save seed since the 1930's (at least not seed that would be worthwhile to grow). Growers pay the premium and sign the contract because the increased yields and reduced inputs (pesticides, etc.) make it worthwhile.
I guess you could make a better seed-saving argument for soybeans. However, soybean growers are free to save seed all they want...just not Monsanto's seed. If the stinking hippies got their way and there were laws passed against Monsanto's (for example) current business practices as you defined them in your post, then the profit motive would be gone and innovation would cease or at the very least be left up to a woefully underfunded public sector (not arguing for more funding - the IRS takes plenty of my paycheck already, thanks!).
I don't see how patents prevent competition (on the grand scale...I realize that is their purpose on the micro level). What specific changes to patent law would you like to see?