[jimerax]

Well I'd like to see actual calculation method by your suggestion, since from your post I can't imagine how it's done.

But it looks there're some issues on this.
First of alll, average ranks and overall ranks aren't accurate indicators of player's skill.

Complicated dynamic calculation of difficulties like that will require a lot of server source, and considering difficulties are frequently reffered parameters in the game, it will be difficult in terms of this.