Sounds right. There's a very small percentage of kids who take every chance you give them to go out and practice, practice, practice. Those kids will always rise to the top, regardless of club politics, elite leagues, biased coaches, and the assorted unfairness of youth sports in America. Then, there's a bunch of kids who just have the natural ability to make it into the elite tier without the extra work. They are the lucky ones, and the opportunities fall at their feet ... at least for the first few years.
The rest of the kids - the majority - don't have the freakish natural ability nor the drive and they sooner or later get cheated by one or all of the components listed above (leagues, club, coach, or a lack of $$$). It feels horrible when it happens to you, but when you decide how to react, just be sure you aren't putting an outsized importance on it as compared to the extra effort your kid is putting into it.
If your kid isn't one of the players missing his friend's birthday party to go out and train, then it might not be worth spending your personal capital trashing a coach, a club or a system. Keep everything in perspective. We all want our kids to be happy, but that can come in many different ways, and there's really no pot of gold at the end of the elite super duper league rainbow, which you find out when you get there.