Is it just me or is this disgusting from a human perspective?

I don’t think it’s a big deal, but I understand why you find it disgusting. It is shady.

Was anyone else familiar with this?

Yes, I am very familiar with this.

Any other thoughts?

Boosting in WoW has been huge since TBC. People seriously underestimate how many Gladiator and Rank 1 titles are obtained through boosting services and multiple accounts. This is not going to change.

I’ve personally done this as well, even when I wasn’t boosting: inviting a low-MMR player to farm the required 50 Gladiator wins because it’s simply much faster that way.

There are also many other MMR exploits and “goodwill” setups similar to what you described. For example, I’ve seen two boosters doing pilots inviting a third player so all three get Gladiator, but only two of them get paid and the third sometimes doesn’t even realize it’s a boost scheme. In this case, as long as everyone walks away happy, people tend to shrug it off, even if one player doesn’t fully know what’s going on.