This tends to imply the Sadistic Conclusion: that it is better to create some lives that aren't worth living than it is to create a large number of lives that are barely worth living.

I think that the Sadistic Conclusion is correct. I argue here that it is far more in line with typical human moral intuitions than the repugnant one.

There are several "impossibility" theorems that show it is impossible to come up with a way to order populations that satisfies all of a group of intuitively appealing conditions.

If you take the underlying principle of the Sadistic Conclusion, but change the concrete example to something smaller scale and less melodramatic than "Create lives not worth living to stop the addition of lives barely worth living," you will find that it is very intuitively appealing.

For instance, if you ask people if they should practice responsible family planning or spend money combating overpopulation they agree. But (if we assume that the time and money spent on these efforts could have been devoted to something more fun) this is the same principle. The only difference is that instead creating a new life not worth living we are instead subtracting an equivalent amount of utility from existing people.