From my experience, it definitely depends on the school. Some schools that have "rolling" admissions generally review applicants on a first come, first serve basis. Admissions committees meet certain times throughout a given semester, and that's when they pull applicants from the applicant pool that they wish to interview. That's why some people will receive an interview invitation date on, let's say, October 12th for October 24th, depending on whether they applied on September 28th or October 11th. Sometimes, it's just good timing with when the Admissions Committees meets. Again, I can only postulate this based upon my experiences with interviews thus far. I'm not completely certain how it all works. Basically, as they meet throughout the semester, they just pull chunks of people and whether its based on merit or just time of application is uncertain.
I think with larger state schools, it seems like they utilize the above method you described of sending out the "top" round of applicants first - however in most cases, those who apply earlier have a greater likelihood of being accepted due to the sheer nature that there are more spots open in the beginning of the application cycle than at the end. Some larger state schools will weed out and send out rejections to out-of-state students immediately, it seems, if you are not a 4.0 student because of the fact that you are not a resident of the state and the likelihood of you actually attending are slim. Again - just postulations, but definitely what it seems like in my experience.
I am curious to see others opinions of the process as well! Definitely an interesting question!