Well for the recruitment/larger clubs, the point that "they will sign everyone" is that they have so many teams it doesn't matter if they put the hold overs in a lower class 3 team. The key is there's a place for everyone, but not everyone on the first team. The other issue is that assignment may take place for a variety of reasons other than merit (coach's relationship with parents, trying to keep squads together that already gel, the B team needs a decent striker keeper or CB to make a run of it so you don't put all the top players on the a team). The "Bad Parents" soccer movie does a good job of hitting all the trophs.
The problem with the AYSO system, at least in my experience, is that none of that necessarily translates into the game and player's can't evaluate the coaches. It's also hard to evaluate player's positionally, such as defenders since it's hard to do a "defenders stations" and goalkeepers. Finally, a lot of those evaluators are not the actual coaches of the team and don't have skin the game, so their opinions while given some weight are not definitive. Favors the early bloomer over the tactical/technical players. Favors strikers over defensive players.