> If anything, those stock awards sound less attractive as they should be options at a very high valuation?

An option to buy something at a certain price isn't the same as just getting the something. As mentioned in the article, ceo compensation consists usually of stock + options (et al.) tied to performance targets.

> In effect, isn't this the same as later VCs reallocating the cap table in favour of the founders (and against earlier investor and employees)?

Sort of, that's the point of the article. Apparently, new founders take on too much early financing.