Even if what you say is true the good teams are not brought down lower than the bad teams or vice versa. The good teams would still have a better record.
If one team in the league is clearly the best team in the league bar none and your normalization effect is in place maybe they only win the division by 8 games instead of 18. I dont' see what the big deal is all about?
I just looked at some of my past teams and found a team that had a record of 100-62 and won the divsion by 15 games. I then looked at how they finished the season to see if they were being curbed (normalized down). They finished winning 9 out of 10 games.