playBunny: I dont know the true rational, but in all of my sporting experience it is the most common bracketing that I have encountered. Generally in these situations though, the teams get their ranking by playing each other as part of a league or conference or the like.
For example NCAA college basketball tournament getting ready to start soon here, takes the top 64 ranked teams (basically) and pits #1 ranked vs #64 and so on down the line. Tennis is international and does similar in their tournaments. It seems to be quite common, and the ratioonaol seems to be that if you have earned the highest ranking to begin with you deserve to play in the finals against the number two ranked payer unles someone is able to upset someone along the way.
One point, in college basketball for example, your ranking is not in jepardy if you get upset as it is the last game of the season for you. In backgammon tournament here, your ranking is effected by an upset from a lower ranked player.
I think for a backgammon tournament here, set up likie this, it should be a 7 or 9 game match to make it more likely that the better player will not get upset.