It’s not a nightmare, kids that don’t behave can be kicked out of a school to one with less strict standards. Then, simply have every school stream their children based on intelligence.
edit - also, from my observation, concentrating all the nutters under one roof does not really help, if your aim is educational. It just takes a lot of little problems across a lot of schools and turns them into one big unmanageable problem that can be politely ignored.
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John Donne - Devotions upon Emergent Occasions - Excerpt from Meditation 17