Yes, the Denver Nuggets may be well on their way to a 50-32 record, finish out of the playoffs and therefore a lottery pick. Now that's insanity.
what is insane is that David Stern is too stupid to fix it, and thus a team 10 below .500 will make it in the East. that is what is insane.
The owners would never vote for a playoff system like that. East owners would say "no" because they know most of their teams would be left out. West owners would say "no" because they know stuff like this is cyclical and that in the future, the power may shift to the East, leaving western teams home. The ideal thing would be to scale back the playoffs a bit. They're the only sport I can think of that invites more than half of the league into the playoffs.