Fedora on ARM definitely works better than Yocto out-of-the-box. It's also much larger, and you don't have much control over the core components. You don't have control over how the packages were compiled, and you'd have a hard time reproducing your exact build later (especially if your flow includes a dnf update somewhere).

Yocto is the wrong tool if you're looking for a good developer Linux. It's a great tool if you're looking for a way to make a highly customized Linux image. It provides good reproducibility and strict license mechanisms to make sure you don't run afoul of anybody's open-source license. It also provides you with tools to compile and include your own recipes, and easy ways to modify upstream recipes without needing to fork the Yocto repos.