Move over Elo - crowdsourcing a new chess rating system
kaggle.com
kaggle.com
A 100 point difference between two players suggests that the stronger player will score 66% ((1#wins + 0.5#draws + 0*#losses)/#totalgames) and a 200 point difference will predict the stronger player will score 75%.
I've been participating in a website that uses directed acyclic graphs to rank NFL teams (http://beatpaths.com), but lately I've been thinking about PageRank after reading a paper on it: http://www.ncsu.edu/crsc/reports/ftp/pdf/crsc-tr06-19.pdf
You could probably make similar adjustments to PageRank to make it suitable for chess.
As you say, it works wonders and it throws 'book players' of their game like almost nothing else.
Suddenly they have to play instead of regurgitate.
If you don't learn the theory behind the openings (whether by reading or by observation) you will remain a below average player for a long time
I don't think my solution is that clever, but it's gone straight to the top of the leader-board with a 0.70 RMSE.