It's kinda simple: Sage can trick you into thinking you're doing well because your power relative to others your level outside of your server seems to be good.

Your power outside of your server means almost nothing at all though.

What really matters is your power relative to others in your server(s).

Sandbagging your levels is much more likely to allow those in your server(s) to increase their power relative to your own and is, thusly, mostly not a good idea. It's basically THAT simple.

...but even so, the point about none of that even mattering insofar as good or bad game design is concerned finds all of that immaterial. The only reason it isn't actually "bad game design" is because the model of the game is NOT for a great game experience for all of its players. As a "free to play game" the model for the game changes and all they really care about is best way to try and increase revenue. The plunder system is actually around in large part because it DOES discourage F2P players!

(meanwhile, increasing level helps unlock things that increase power as well - like equipment upgrades, ninja awakenings and cultivations, 8 gates spots, ninja tools you can wear - and all of that helps go further in the game and do things like better TIs and everything else... and if you're ever keeping your level down and it's stopping you from having enough power to get MORE POWER in the game then all of those losses can ac*ulate over time and snowball effect in a negative manner, in the same way that increased power (which levels can help with) can snowball effect in to even more power over a period of time).

Telling people to keep their levels lower than they could is very much telling people that they should have less power. It is absurd that your "solution" is to tell people they should sacrifice power just in order to not be plundered... for what? For a few extra coupons to TRY and buy back the power they have been losing just because they're sandbagging?