You brought up some very good points, Jo. I remember my children being in school and receiving the same prizes as the entire class even though they had made better grades. One of my step-sons was very upset, he was 12, at that system. He understood that they were trying to "level" the field and he stated that he knew that when he got in junior high, things would be different. So, we came up with a formula at home where the child that did really well during a week at school got extra privileges. I really think it helped our children prepare for junior and senior high. They entered feeling pretty self-assured and did well. They took chances and joined organizations that I don't think they would have joined if we had not corrected the grade school impression of everyone receiving the same reward...regardless of their efforts. They were all in the orchestra..one played golf and one played tennis, one took German...it was really cool to watch them.
In our case, self-esteem that was developed at home, was very important to those kids.