Zoos do help to preserve species. Whether that is worth it, when their natural habitat is destroyed is a different question.
And if we agree there should be Zoos (I don't) then breeding the animals there is definitely nicer, than capturing a wild animal and force it to adopt to the prison livestyle.
doing something good doesn't make other things also good. there is some kind of demand they are servicing or a need they are having which they cant meet in some other way (finances..) though, which is likely the root of the issue rather than the zoos' existence itself. this is ofcourse ignoring the opinion (which i also hold) that zoos themselves are essentially or inherently bad. kids' enjoyment is not a good reason for cruelty and imprisonment/enslavement. neither is money or anyhting else. Domesticated animals is a different story.