yeah, no system is perfect, but the modifications I suggested I think would address these issues to large extent. For example, I suggested that employees would rank their peers on three scales (good, bad, misused) instead of with "scores". An actual score would hopefully come from aggregating the whole company and doing some analysis. Hopefully by having some smart people try to put together an algorithm that seems "fair".
Also, if I remember correctly, MS employees might have had some say in their peer's rank, but then groups scores would be merged with other groups by having managers "calibrate" with each other, which more than likely gives the manager a lot of control in the final outcome.