Have been reading several of posts about the tournaments good and bad. I have not played in one but still have some ideas - 1. have at least 3 tournament levels with graduated prize levels. Higher levels bigger rewards, 2. cap each level with a creature maximum score (keep higher level players from sandbagging into lower levels), 3. Don’t allow flagged cheaters into arenas.
For your 2nd suggestion they don’t have to do anything,just the last player from the above Division will have the same reward as the first player from the lower Division
Some people think having only one level helps their profit. I think they would increase profit by having more people thinking they have a chance to win.