Okay, lots of things here. First, why is this a big deal now and yet nobody complained about it in 2.0? At least in 3.0 everybody has a chance at everybody. In 2.0 there were certain guys that would drop to A+ schools and not C+ schools, not to mention the whole 70 mile thing. Yet we all (sure not all) loved pull downs even though some D1 guys would go to certain D3 schools and not others. That was inherently unfair.
Second, to go with what hughes said, the division players are listed at really doesn't matter for a lot of recruits. I have a little exercise. This is from my list in Phelan with my D3 Cal Tech team this past recruiting session. Which guys are DI which are D2 and which are D3?
Player A: Center Juco Jr
Ath 69 (Blue)
Speed 19 Black
Rebound 72 Green
Defense 74 Black
Block 58 Black
LP 45 Black
WE 64
Player B (PG) Juco Jr
Ath 27 Green
Speed 81 Red
Def 36 Black
Per 72 yellow
BH 66 Green
Passing 74 Black
WE 53
Player C SG
Ath 55 Black
Speed 68 Black
Defense 68 Green
Perimeter 44 Green
BH 67 Yellow
Passing 38 Green
WE 18
Player D Center
Ath 82 Black
Speed 16 Black
Rebound 59 Green
Def 58 Green
Bloc 46 Black
LP 45 Black
WE 29
Player E PG
Ath 62 Yellow
Speed 63 Green
Def 40 Green
Per 75 Yellow
BH 49 Green
Pass 42 Green
WE 36
Here's the point. With limited budgets you have to give coaches a chance to go find some good players, and we have better chance to do that at higher levels. If not it just becomes who is lucky enough to scout some D3 guys who can actually play. And like the original poster said, the system works. I ended up with a D3 guy, a D2 guy, and a D1 guy, just about like I would have in 2.0. To go along with this, a lot of D1 guys are not D1 guys. Some aren't even D2 guys. What is wrong with a D3 guy who the system wrongly lists at D1 going to a D3 school? And the levels given by the game are projected levels anyway. For those of you who follow the NFL and the draft, how many guys are "projected first round picks" only to fall to the second or third round? I see this as similar to WIS projections. Sometimes they are wrong and guys fall. Last, it's not like they sign on the first cycle. If nobody else wants them after 25 cycles of recruiting, I say let them go to the team that recruits them.
FWIW
Player A D2
Player B D3
Player C D1
Player D D2 (by far the best player in the group, lost him in a VH vs VH battle to another D3 school)
Player E D1 (mentioned on first page as player I lost in second session which is fine with me. I shouldn't be able to beat a DI school and he should wait for an offer to sign at his projected level)