The defense is designed to prevent 3's and allow contested 2's.
The reason? Analytically, a defense doesn't have as much control over whether or not a 3-pointer goes in. You can contest and prevent wide open 3's, but it's more about luck of the draw and the offensive player's own shooting ability than the defense when it comes to lightly contested 3's.
But that is not true in the paint, where strong contests and blocking shots can very much lower opponents' shooting %'s as a function of defense.
We hard hedge on screens to prevent their point guards from attacking on straight line drives, but guard up on players aggressively outside the 3-point line to discourage catch and shoot 3's. As you observed, this leaves us "vulnerable" to penetration from wings, but we expect our players to be able to recover and at least make it a difficult drive, and we rely on the weakside shotblockers, who can contest/block/alter the shot. The trade-off is that opponents shots are a little closer to the rim (and thus a little more high %), but the heavy contests are designed to reduce that.
And it has been working very well this year. So despite what you see as constant drives, we have the 4th lowest 2pt% in the country at 42%. St. John's shot 38% on 2-pointers. And we allow the 19th fewest 3-pointers attempted against per field goal. If you want to take a 3 against us, fine, but it's going to be heavily contested, not just lightly contested, due to our overplay.
There are two main downsides (every defense has pros/cons). 1) The recovery by the wing defenders and rim protectors in addition to playing physical D causes some fouls, and more shooting fouls than most teams. Too many can give opponents efficient foul shots and get some of our better players into foul trouble. 2) When opponents play 5-out, it makes the rotation longer for our rim protectors and we end up giving up some free layups and wide open backdoor cuts instead of strong contests and blocked shots. This is why we struggle against Villanova every time and Maryland/Creighton last year (Maryland was a horrible draw for us). The good news is that by having Sanogo and attacking the offensive glass, we can also punish these teams on the other side of the court unless they have the perfect lineup combination (a 5-out center who can also defend Sanogo 1v1 in the post... hard to find).