4) In ELO, it's possible to lose rank for winning. It's happened in chess many times, and it even happened to me in Halo 2. I earned a 32-33 in the Ranked BTB playlist before the big wipe - I had about 700 games completed of BTB at that point. One night, we had an amazing run with a full party of 8 where people in the party went from 22 to 27-28. I was ranked down to 29-28 from WINNING because all the people that were left were no higher than rank 15-17. I thought it was hilarious myself, but someone hardcore about rank would have been livid. But this is a result of ELO - it is designed to punish someone for playing someone far below their rank, and to stay near people of their own rank. Of course, that is counter productive to
5) Halo 2's ranking system was also used in matchmaking, in both ranked and social (guests allowed) playlists. Since the rating system encouraged you to play people near their ranks, you'd end up with massive gaps of rank. Since there were massive gaps of rank, when people stopped playing the game it would result in epic search times.
,,,
Everyone was clumped together into little islands of skill. When population dropped due to competing games and the launch of the Xbox 360, this islands could disappear practically overnight, causing a chain reaction of people moving to other playlists or just not playing Halo 2 anymore due to search times.
The only way to fix this was, of course, to reset the ranks. While I personally didn't mind, people who had marched to a 50 somehow legitimately were screwed. They had to do this 3 times. Once for the Big Update, second time was in mid-2006 when they issued a big anti-cheat patch, and the last one was when the Blastacular Map Pack came out. The first one was sort of a given since the game had dramatically changed. The others were to simply to keep matchmaking working.