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After their CTE date, they'll either be full or know they need X # of seats filled, which will go to the waitlist (which I assume requires a pretty quick response), and then they're full.. So maybe, what, a week or two after CTE they'll be full (barring last minute special things like you mentioned)?
Are you saying that after they're "full" that they're still going to keep dozens (hundreds? no idea how big waitlists are) of people hanging on a waitlist?
I feel like selecting CTE would not be as effective since those same students must manually withdraw their apps from other schools. What if student X selects CTE at school A and neglects to withdraw a waitlist/acceptance from School B?