This could certainly work, but it could get messy as it often does when there is this kind of wave/division at smaller races. I think it likely ends up pitting more of the top athletes head-to-head, so that's good. But what if the overall fastest time isn't from this wave? Are they still "national champion"? Or do you have to be in the open wave to be considered for overall placing?

We have this at our local race series in Colorado. What ends up happening is that about half the top 10 is in the elite division and half isn't for whatever reason (age group podium pics look better on Instagram than no podium pic in the elite wave?). It becomes sort of pointless. With worlds slots (which I'm sure some of the top athletes do care about), the pull to not enter the open/elite wave becomes even stronger than it is at the local races.

For this to work well I think there needs to be a strong incentive to be in the open wave. Or even forced entry into the wave above a certain USAT ranking score (though that is bad for those that do care about worlds if worlds doesn't have this category too). I don't see a strong enough incentive to get all the fastest people in this wave voluntarily until it is some exclusive/qualification thing that culturally is sought after.

I still think doing the waves by USAT score would be best (not perfect). Sure, the top of an age group might start 2 hours before the bottom of an age group, but those people aren't really competing anyways even though they're in the same age group. I don't think you'd have anyone complaining about that.