Sure, people come here because it's known to be hard. But once they're here that goes out the window. You're trying for grades, not challenges.
The system shares as much blame as its users. If challenging oneself was rewarded then we'd have more of it.
Of course it was full of pre-meds and chemical engineering majors (ie. pre-oil). Draw your own conclusions.
The departments that had the lowest mean grades across their courses were physics and economics. I took that to mean that physics was actually a very difficult major (I admit I'm biased here). Economics, on the other hand, was what most of the scholarship athletes majored in (my university didn't offer communications or marketing degrees that you sometimes see). Not to say that economics wasn't difficult, though I never had a chance to take any courses.
It's the difference between an elite education and the rest of us educated people^. Now, this doesn't apply to all the big name schools. I think there is a market for schools that make it tough. Look at which schools hackers think are the best in science/math/enginnering schools CalTech, MIT, Stanford, CMU, etc. They are still tough with less grade inflation. (I apologize if I left your favorite top school out of the list, assume I included it)
^I may not agree entirely but it's an interesting read: http://www.theamericanscholar.org/the-disadvantages-of-an-el...