It's odd that I drafted in my div. IV league, and then promoted to a totally different league in div III, in which almost everyone got a better draft slot. I imagine that teams demoting got a great draft slot, and then were placed in an easier league (in which the tops teams got a bad draft slot).
I think it would be more equal to promote/demote teams first, and give them some sort of weighted position in the draft. (This assumes the desire for more parity, and changeover of teams between divisions between seasons).
I'm assuming that for teams which promote or demote, the draft position has no (apparent) relevance to their new league. Is there any weighting given to quality of draft picks across divisions? (e.g. Is the #1 pick in higher divisions better or worse than players in lower divisions?)