I’m having a hard time squaring reasons 1 and 2. If legacy admits struggle, are they really being coddled? Personally, I didn’t apply to Hopkins because it sounded like boot camp. So your reason 2 seems a lot more plausible.
The point is that the legacy admit will be coddled at the admission stage but will struggle once they’re in. Which, to be honest seems even worse: the kid was praised a year ago for getting into a good college but one year in they bomb out leading to a lot of stress for everyone.
