I'm sure you're right, but it does seem to favor longevity, or at the least I'm pretty sure it will make it such that it will take even longer for a good player to reach their "point of equilibrium".

Why have it there in the first place?  Are you trying to encourage higher scores?  ..encourage better players to play with newbies?  I guess it doesn't matter, yet.  For it to kick in you have to have 5 times the rating as your opponent.  Anyone been in any 2500 v 500 games recently?