I would tend to disagree with point 2, particularly that character changes don't affect the rank much. I got many a wins off of low tier characters in CS1 and that's how both my Lambda and Tager were ranked so high. I personally wouldn't want my rank to transfer over since that was the case.
Well, it can only happen a limited number of times. If they kept winning, they would rank up and have to leave the room. Ultimately, it makes it faster for the player who should be higher to get that high rank faster, which is good and prevent something like it happening in the future.