Harvard isn't known for their CS program. I did CS undergrad at a school ranked quite a bit higher than Harvard (for CS). I think that CS50 would have been quite an improvement on the intro class at my school. But you have to understand, these classes are supposed to be
hard. CS requires a huge amount of self-study and a huge amount of independent work. The kids that aren't willing to do that gain nothing by advancing to the second year curriculum.
The system isn't perfect - it never will be. But seeing lots of kids at sections and office hours is a good thing. It shows that they are willing to ask for help when they need it, and are willing to put in the hard work to succeed. I'm sure that some of the richest kids pay for private help. But one thing you need to understand about the wealthy is that they are more likely to make use of the services that are available to them. It is very striking to see how many poorer people suffer in silence when help is available, because they don't want to be a burden or are embarrassed to be in need of help. I assure you that no rich person ever feels embarrassed by asking for help.
As for Harvard Extension, a lot of people will tell you that it is around 100 years old. But in reality, it is a lot closer to 200 years old. Harvard alum John Lowell Jr left half of his estate to provide educational opportunities to greater Boston. They paid the most accomplished academics they could find to present lectures for free or cheap at night so that people who worked jobs during the day could attend. It wasn't limited to Harvard professors, of course, and it continuously evolved to serve the needs of the day. The trustees at MIT were the first to organize lectures into a real curriculum rather than a set of ad-hoc topics. By the early 1900s it had transformed into an organized group of all of the colleges and universities in the Boston area. Depending on the subject matter you studied, you "graduated" from the school that specialized in that subject even if you took courses at a different school. All those schools dropped out, one by one, until Harvard was the only one left - which shows their commitment to the concept (no entrance exam, inexpensive, targeted at non-traditional students).