Jezus. I've never seen that before. the poor guy is auto relegated but gets to draft as the 5th guy. To me, this is a problem of having one conference dominating the other to much. It's fair and unfair:
Fair: his team is stronger than the bottom 4 teams in the blue conference (i reckon you will agree with me on this). His team was also the weakest team in his conference (just look at the relegation games: the red side teams are winning rather easely!). So his demotion is fair and the fact that he's drafting 5th is also fair because his team was a lot stronger than the other teams.
What is unfair for him, is that his conference was so much stronger than the other conference. Even worse than that: Because his conference is so much stronger, they take games off eachother, meaning that Rucker Squad has HCA in the finals (because he only has 1 other decent team in his conference, Green hornetz). Also, the #7 red team would be in the PO's on the blue side, which is just crazy!
For me, the problem isn't with the draft order! The problem is that the red side is so much stronger than the blue side, meaning that you've got an unhealthy balance in your division. To solve that problem, there should be a re-seeding at the end of the season. Strongest team goes blue, second strongest red, 3rd best record, blue side, 4th best record red side, etc etc. that way, the strength of that division would be more balanced and it would avoid situations such as the one which has happened in that division. That seems like the only real solution for that division. But i really do feel bad for the 9-13 guy! (ps, i was on the receiving end of such a demotion once: check season 23 in the BBBL (Belgian top league). I've been in his position before, so i really do feel for the guy.