I don't see why I would need to erase my external drive.

My Time Machine drive wants to backup 350GB of data when all of that is duplicate. I would think that after using Migration Assistant to restore your old settings and files, there would be an option to continue with incremental changes in Time Machine, instead of Time Machine wanting to backup exactly what I just copied from it two hours prior.

And ditto for my external drive. I use Time Machine to back this up and now it wants to back this up again given the computer change.

That's why I thought Setup Assistant would circumvent these issues, and would link the new Macbook with the old Time Machine backups. I read Migration Assistant doesn't do the same thing.