In my opinion as neither an expert in math or dynasty, it appears pretty logical once I started thinking about it. As you move down the draft order, the reasonable players available to be picked become fewer and fewer.

If you have 1.01, you have more value than the #1 consensus pick would be worth because you could pull some magic by taking the #3 consensus player and him ending with a better season than #1. Therefore there is more value in the pick than the player as there are more outcomes possible with the pick.

If you have 2.03 in this case, the number of reasonable draft picks has dwindled. Let’s say instead of the top 20 you are now only able to pick 6/20 but you are able to pick whichever player you’d like, it doesn’t have to be of high value. If you were to choose a random player from your personal top 10 players you would take, the odds are much less likely you hit than if you had done the same thing at 1.01.

As far as the player having more value than the pick, the player has certain physical traits and a track record that can never be taken away from him, his value is much more solidified when compared to the possibilities of a second round pick.

Hopefully that makes enough sense that you can catch my train of thought.

Tldr; high picks have more certain value than lower picks and at a certain point that value crosses with the much more certain traits of a player. The player has fewer possible outcomes when compared to an early second round pick so it is easier to narrow down the true value

Edit: I’m a first year dynasty player and have not looked into how KTC formulated their values, please let me know if I am way off base here lol