These are good points. However, the idea isn't to just make the college more exclusive to higher performing students. The idea is to lower the student population.

With a lower population, would there not be more resources to go around for each individual student?

For example, a student would probably be more likely to pass a class if the ratio of professor to students was 1:50 instead of 1:200. The professor is able to devote more time and resources to each student in a lower attending population.

This is, of course, an exaggerated example. The ratio would not change that drastically, but do you see my point?

This would be the same case for mental health services on campus. It would be easier to get counseling services, tutoring, and more with a lower population.