Exactly! (for the second part)
I mean why aren't they qualified? Cambridge is getting more applications than each of the top schools in US every year. They interview almost all of them (80% to be precise) and still announce the results in January (though you apply earlier). It is certainly doable and it is more accurate.
I do not get this admission officer business not even a tiny bit. I mean if you are undecided and do not fit in any criteria then fine let an admission officer decide on your fate but if you specifically insist on a subject then why not be judged by your future professors. These professors can certainly have half an hour interview[1] with the candidate take a look at your candidate's account.
If professors are super busy let graduate students do it or researchers do it. These three groups of people will have a better understanding of a well suited candidate. Think about it this way: You're hiring programmers and you have one of these two options: As a programmer consider their applications yourself or just tell a nonprogrammer to do it. You'd argue this analogy does not work because one does not have to declare his major and you are right if you think about it that way but if you consider a huge corporate structure and a policy, which each and every department should obey then you will see why this makes sense for a university too.
Obviously there are criteria that MUST be considered during application process other than your skills and I am all for that but let candidates be filtered by actual graduate students or professors or researchers first. Why? It is because in any case they will have a better intuitive understanding of being a student in "X University" compared to admission officers who are "told" what should the students be like plus they have the degree of expertise to judge the student on their specific subject.
And for the first part, you do not have to have olympic medals to get a place in undergraduate division of these universities. Maybe a projet or two but the competition is not THAT intense. I mean there aren't hundreds of olympic students (relevant olypics) applying to subjects every year anyhow AND believe it or not few years of hacking can be more useful than an olympic medal. This is another discussion what I want to point out is my observation strongly disagrees with your interpretation. I tell you 90% of the time first kid is preferred over the second kid one.
[1] Please don't say it takes too long, again, in Oxbirdge, each candidate has two interviews for AT LEAST 30 minutes with four professors in total.