I agree with some of what you say...
1) Blue flags would be good..even with current system
2) Our fastest person (MZ) is ABSOLUTELY a match in a real series. Go look at some historical data from UTAH and Master of the Mountains - won championships there too, and had lap records.
3) Other clubs are Novice & Pro, I'd like to see our club move towards that, but with CSBK having intermediate and Pro, it does limit Canadian structures. Unless that gets changed from the top and trickles down, I don't see it happening at EMRA, which is not a big problem. It does give more people a sense of security riding against similar paced racers, without the stress of getting in the way of Championship contenders in Pro.
Where I learnt to race, everyone was pro. If you felt you were going to be lapped in a race, you had a large black "X" on your leathers back, so approaching speeders knew you were slow from way back and we used the Blue Flag system. We had more classes to help move up, so by the time you reached 600/1000 you had 2-3 years racing experience (Minimum). We all come from different backgrounds, but we should work within the system we have, and make it as safe and enjoyable for as many people as possible. Lets not just moan and criticize, but lets have constructive dialogue, and if you really want to be heard and try make a difference, attend the AGM or join the board.