Under my system, (see link above in an earlier post) what would hurt you BADLY is losing to a very poor team. The kind of team you should beat routinely, with Great ease, and should have no fear whatsoever of playing. If you can't beat the bad teams under my idea (reverse Harbin points deducted for losses) you sure can't beat the good ones anyway, and are NO THREAT at all to win the State or even the Regional title. Lose to an undefeated team like Mentor or even Gibsonburg and the loss would only hurt you on the first level. No second level points lost unless that team went on to lose a game.Here is the problem with the system you describe. It makes it more imperative to schedule games against teams you know you are going to beat. It would not foster more freedom to schedule games against tougher opponents, it would make it more important to not schedule games against teams that you will lose against. Of course this would only apply to those schools just trying to get into the Playoffs. For those who are trying to make a deep run, they are more concerned with preparing for the deep run, so they will schedule tougher opponents to make them better.
Just my 2 cents
If you schedule teams you KNOW you are going to beat, you will end up with a schedule like Gibsonburg's (I know they didn't schedule that way on purpose, but still.... it wound up being a steady diet of cupcakes for them [this season anyway] nonetheless...) and have a Harbin total that won't get you in the playoffs at all. You have to take your chances, play at least decent to good teams and defeat them. My system penalizes all losses but it penalizes losses to very good teams only slightly and losses to very bad teams heavily. It is the EXACT opposite of how WINNING is treated under the Harbin System. Which currently is: beat a good or excellent team get a big jackpot of points. Beat a winless team get next to nothing. But, right now, a loss to 9-0 Mentor is treated exactly like a loss to Lyndhurst Brush which is 0-9 at this writing. It should be a slight penalty for losing to Mentor and a large one for losing to Brush in this season.
Why aren't ALL GAMES considered under a rating formula? They sure are in college football, game announcers are always bleating about who a team lost to and can you sort of discount a college powers loss because it came against a good team. Look at OSU the last two years, people penalized them because the losses to Iowa and Purdue weren't considered to be against good enough teams. I think a good rating system should consider ALL games and it's one of two major flaws I think the Harbin System has. This one is easily corrected.
The other major flaw is the Harbin Cow phenomenon and that one needs addressed also but I'll stop here unless someone wants to hear what I have to say about it.