racket | Serve your models with confidence

When you are doing the SICP problems, it would be most beneficial if you strive to adhere to the spirit of the question. You can determine the spirit from the context: the topics covered till the point you are in the book, any helper code given, the terminology used etc. Specifically, avoid using parts of the scheme language that have not yet been introduced; the focus is not on whether you can solve the problem, it is on how you solve it. If you have been provided helper code, try to use it to the extent you can.

SICP has a way of building complexity; it does not introduce a concept unless it has presented enough motivation and justification for it. The underlying theme of the book is simplification through abstraction, and in this particular section you are introduced to various higher order procedures -- abstractions like accumulate, map, filter, flatmap which operate on sequences/lists, to make your code more structured, compact and ultimately easier to reason about.

As illustrated in the opening of this section, you could very well avoid the use of such higher programming constructs and still have programs that run fine, but their (liberal) use results in more structured, readable, top-down style code. It draws parallels from the design of signal processing systems, and shows how we can take inspiration from it to add structure to our code: using procedures like map, filter etc. compartmentalize our code's logic, not only making it look more hygienic but also more comprehensible.

If you prematurely use techniques which don't come until later in the book, you will be missing out on many key learnings which the authors intend for you from the present section. You need to shed the urge to think in an imperative way. Using set! is not a good way to do things in scheme, until it is. SICP forces you down a 'difficult' path by making you think in a functional manner for a reason -- it is for making your thinking (and code) elegant and 'clean'.

Just imagine how much more difficult it would be to reason about code which generates a tree recursive process, wherein each (child) function call is mutating the parameters of the function. Also, as I mentioned in the comments, assignment places additional burden upon the programmers (and on those who read their code) by making the order of the expressions have a bearing on the results of the computation, so it is harder to verify that the code does what is intended.

Edit: I just wanted to add a couple of points which I feel would add a bit more insight:

1. Your code using set! is not wrong (or even very inelegant), it is just that in doing so, you are being very explicit in telling what you are doing. Iteration also reduces the elegance a bit in addition to being bottom up -- it is generally harder to think bottom up.
2. I feel that teaching to do things recursively where possible is one of the aims of the book. You will find that recursion is a crucial technique, the use of which is inevitable throughout the book. For instance, in chapter 4, you will be writing evaluators (interpreters) where the authors evaluate the expressions recursively. Even much earlier, in section 2.3, there is the symbolic differentiation problem which is also an exercise in recursive evaluation of expressions. So even though you solved the problem imperatively (using set!, begin) and bottom-up iteration the first time, it is not the right way, as far as the problem statement is concerned.

Having said all this, here is my code for this problem (for all the structure and readability imparted by FP, comments are still indispensable):