You need a uniform grading system, which means a uniform material and a uniform grading process, which is... standardized testing, or at least AP/IB courses.
i still got to go to the college of my choice (fire up chips!) but i have to wonder -- if i was able to boost my gpa using ap/ib courses, would i have received more scholarship opportunities/better offers from other schools?
you could certainly look at past performance of students from that school but that turns into a "legacy system with more steps"...
For one thing, if a school has grade inflation so bad that even an A+ from that school isn't enough to get into Yale - is that a problem?
For another example, if adjustment for grade inflation means Yale will ask for an A+ from Martin Luther King High, Detroit while they'll accept a B from Phillips Academy, Andover - is that a problem?