What's wrong with it is that we are stuck with the assumed prestige set back in 2003. What is wrong with it is that it is counter to the name of the game Hoops DYNASTY. A coach should be able, through his own merit, to build a dynasty and maintain it realisticly. Yes, for one or two seasons Kansas can have a "bad" year, but string them together, not only will the coach be fired, but the school WILL lose their standing as an elite.
Baseline prestige is great as a starting point, but I'm on the side that says that, just like at Duke, a coach can turn an ok program into a dynasty and keep it there. Start schools at that assumed prestige, but then let it slide towards success or failure based upon the coaches at that school's success over time. Resample baseline up or down off of 5 year segments. Heck even 10 year. I'd like to think that lostmyth's St. Bonaventure team in Iba is a good representation of a school that went all Duke-ish and that school's baseline should then be raised to reflect that. So that teams like his don't have to work harder than some of the "A+" schools to maintain it. Schools that only have to make a tourney or two to maintain a A rating every 5 years.
Conversely if some coachs can't maintain the set starting prestige of, say a Duke, then Duke's baseline should slide downwards. Duke ain't Duke if Duke doesn't make deep runs. Duke then becomes another good school in a power conference.
I think it is frankly rediculous for a team like my ISU squad to drop in prestige after an elite 8 run. There is no logic to it.