I think they actually do a good job of determing who is good at that point in time. I don't by all these conspiracy theorys.
The problem is your evaluating 16- 17 year olds who all are at different levels of physical maturity. Most of the 4 and 5 star recruits are early bloomers. While many of the 2 and 3 star recruits aren't as far along in their growth. And then you have many players who aren't even rated because they are such late bloomers, but who in a few years could be as good as some of the 4 and 5 star recruits.