I use CAP only. My horses are related to each other only on paper because I don't actually play the game as it was intended to be played. I write stories and make still shots to accompany them/enter shows.
You can also use mods like NRAAS Master Controller to have your horses instantly have a foal with another horse if you wish the genetics and lineage to be accurate in game. The reason I create the offspring directly in CAP and not with mods is because of the amount of custom markings and sliders I have in my game... If you have a lot of CC you will notice you can no longer press the randomize button in CAS/CAP because what will come out will be a horrifying monster due to crazy use of sliders... The results are sometimes unfixable so for me I find it easier to take the dam for example as the original template for the offspring, add some characteristics from the sire, create a brand new coat that makes sense genetically speaking (proper genotype) and call it a day!
I'm fairly sure nobody or almost nobody uses the in game way of making foals for their ES/ESRPG horses. They may use it in saves in which they actually play the game.