Confidence and Fear must be kept in balance.
To have too much of one is going to result in problems with your training. One thing that I like about resistive training is that it tends to keep a realistic balance between the two.
When you know that you can beat most of the class sparring it gives you confidence, which is good. Too much can result in being a bully, but often there are people that can beat you, or even people that you can normally beat that get lucky, etc.
Those moments tend to keep your head from getting too big. You KNOW there is someone out there that can beat you....by skill or luck!