(Personal opinion below, and does not necessarily represent the views of chess.com management or anyone else with authority or insight.)
Your suggestion regarding the smaller brackets makes sense, at least in the light of typical class event breakdowns in USCF tourneys. However, reducing the number of players available by a factor of roughly two will increase the number of sections events that won't occur because less than 4 players will be available, or will at least reduce the number of rounds in an tourney event - which, again, is not a positive outcome.
Rotating the break points would be cool, in some ways. However, the confusion that would result would seem to outweigh that.
Just one person's view, of course.
The 400 point-range automated tournament brackets (e.g., 1000-1399, 1200-1599, etc) need to be reduced to 200 point-range brackets. This would "even up" the competition in tournaments and would likely increase participation (low level players that get blasted in the first round frequently quit).
I've actively sought out member-created tournaments set up in this fashion (thanks to those that have). Also, rotating the bracket endpoints week-to-week could be useful too (e.g., 1000-1200,... for one week, then 1100-1300,... for the next).