Even if the grading curve bottoms out with a B, there is still a lot of info for an AO to use – especially with a weighted average to go along with the regular GPA. What often distinguishes the students are how many advanced courses they take, not the grades they get in the classes.
Someone who is taking advanced language, math, history and English will have a very different GPA than someone who is in the standard classes, even if they both get Bs. And someone who is taking all of the advanced courses, working their butt off to get Bs will look different than someone who soars through them with As. You can also tell if someone is lopsided in their skills and interests based on their courses.
The down side is that you can really only compare students within a school re: GPA, not to students in other schools. Grade inflation matters more in schools with fewer advanced course options.