No, Kasich should drop out. Why the heck would Cruz drop out before Kasich when he has far more delegates?
Kasich will play as well and probably a bit better than Cruz in the mid atlantic and north east.... There is no way for him to get the nomination, but without Kasich in the race, Trump tops 50% and triggers the WTA clauses in most of the remaining states that are hybrid.
With Kasich in the race, Trump’s delegate count actually grows slower than it does without him in the race IMHO.