I like that idea. There has to be a way to make it more level across the board. I would break the state into the Rural/1A class, then 5 others:
5A - Teams who have made the playoffs for the last 4 years in a row, split into districts (or regions)
4A - 3 out of 4 years...
3A - 2 out of 4 years...
2A - 1 berth in the last four years...
1A - everyone else, they play an open, regional-style schedule, top 6 make it like current 1-4A.
Some classes would be bigger/smaller than others, but teams could move up and down easily, especially if all classes have a regional schedule/reclassification is done annually. And, while you wouldn't have districts, there would be a "6 region game requirement" but they can be any week.
Or something like that. Anything is better than grouping schools by population and proximity because some schools will NEVER have a chance to compete.
Also, the kids (who this is supposed to be about) don't care who they play. They just want to play ball. Why is it so complicated lol