I fail to see how being in a different division makes you a significantly better/worse player
The idea is that it sorts divisions by MMR and win/loss - for the same reason it uses divisions at all. If all of you have similar win/loss ratios, then the top of the division is the one who plays the most, and therefore it's easy to see 'progress' when playing. This is to encourage people to play more, just like divisions are to let people have hope that 'wow, I'm top X in my division' rather than 50000th in the world. The TL thread explains in more detail.
Obviously it breaks down somewhat once people are sorted though.
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