Firstly, going to a seniority system would automatically lock out any newcomers to the convention. This is a really shitty business model for anyone wanting to grow. Any friends you invite to come will be automated to the bottom of a huge list? That's not very enticing. Why would they come? What is the draw for a new generation of gamers if they can't have the same chance as everyone else? At least in the dash-and-grab model, anyone with an internet connection was fighting with each other, so you would be competing anyway. Then there are options like the VIG badge, with seniority systems in place that allow for people who go often, and go every year, to get early access to housing. Maybe you should go for the VIG lottery if attendance and a downtown stay is a make-or-break deal.
Secondly, you can't have a convention without staff to run it. Consider hiring people to do a job (for free) for hundreds of thousands of people, and have them commute in every day? Wouldn't fly. Those people make YOUR convention happen. They rightfully should have a place at a nearby hotel. Please don't shit on the people here to help you have a good time.
Third, every time i've not scored a downtown hotel i've managed to trade for one down the line. They are available. People drop rooms. Companies book too many for their volunteers. Keep an eye on the facebook group and forums, and you can likely get a room before July. It takes effort, and that's annoying, but I've picked up rooms and suites like this a lot.
And lastly, it's really no use complaining about wanting things like they used to be. The fact of the matter is that Gen Con has changed. Gen Con has grown. You can't expect it to be the same, even if YOU personally haven't grown or changed, the convention has. You have to adapt and grow with it, or you're just going to be mad about it forever. It was really nice being able to have my personal pick of hotels. I used to make lists of my top choices, now I'm just happy to get something at all. Reminiscing about how it used to be when it was small isn't helpful or relevant. It's not that way any more.
Would you mind linking to the facebook group/forums you're referring to? I haven't found any that look helpful for finding downtown housing... seems like the only option is to keep checking the portal.