it will make rating more unstable and less reliable.
If you are 2000, and you lucky and you win 6 games (or you win 7 and lost 1), you get 2300, but your real level is still 2000; and you will play with others 2300 players and they will trust that your level is 2300. (and you will lose)
Or, vice versa, you have 2000 rating and you unlucky so you lost 6 games (that's more probable) and you have 1700, but your level is 2000, than you will squash the others 1700 players.
This system will be more dangerous
To make 2nd-4th lose equally and HEAVILY - for example, for 4 people with the same rating, if 1 wins, they win 100 but if the other 3 lose they lose 33.3 each. If it doesn't work, make the loss heavier, for example winner wins 150 while losers lose 50. This will make sure that everyone plays for 1st as the win is HUGE and everyone will want to play for the huge win. If people are still complaining, make the wins bigger and the losses bigger, so that more people will want to win and not lose. Also the losses are HEFTY, so everyone will play for 1st. No more playing to avoid 4th, No more gifting points to an undeserved 2nd, No more playing for 2nd or 3rd!