I don't see a problem with the idea of the loot getting better you progress further, but even the low level gear should have some utility to an average player at 99.

All 5 tiers drop level 99 equipment. A majority of which is outclassed by no-effort easily obtainable and incredibly common equipment from either the auction house, other events, or even original nyzul. Look at something like the NQ Euxine Coat. What is the point in this piece of equipment? What player would benefit from this? These rewards don't exist in a bubble.