Valid in terms of analysis of who is retained, but I'm not sure I agree that an officer's decision to pursue a due course path should not enter into the calculus when distributing a ranking.
Regardless of any individual's career decisions, the institution strives to provide enough qualified candidates to control grade milestones to provide the desired selectivity. Reporting based solely on current performance, which ignores the individual's potential or willingness to perform at the next milestone, does not equitably distribute that limited opportunity. It carries the risk of leaving otherwise qualified officers on the cutting room floor, while those with the EPs separate or pursue non-command career paths. Does the current system leave otherwise EP performers on that cutting room floor? Sure, but they weren't interested in DH or command anyway, right?
I think it's helpful for people to stop thinking of their FITREPs as a report card or performance evaluation, because that's not what it is. Its only purpose is for a RS to communicate to selection boards on an individual's fitness and suitability to perform at the next milestone. Nothing more, nothing less.