Great comment, and it is all about kids being placed on teams at a similar skill level and them having fun, especially at that age.
Don't let parent ego get in the way of the process - I know parents that change organizations every single year because for some reason, the group of evaluators got it all wrong when assigning little Johnny to the #3 team instead of the #1 AA team. In cases like this, the kid suffers because they are not developing any long lasting friendships when going from one organization to another every single year. Both of my kids that played PAHL and PIHL hockey played with some of the same kids for years, and my oldest has been out of hockey for years and is still friendly with those kids.
We all want the best for our kids, so my advice is to manage your expectations.