Making the tenth of a percent from 89.4 to 89.5 worth immensely more than the 9.4 percent from 80 to 89.4 is idiotic.
I'd argue that the problem is inherent in the fact that different grading scales (0-100 vs. A-F) are appropriate for numerically-graded exams and subjective assignments like papers. Converting a 0-100 scale to A/B/C/D/F has the problem the OP mentioned. But when it comes to papers, most people can only judge 4-5 levels of quality before inconsistencies pop up. This is one reason why the "E" (high fail) level of the original A-F grading system almost immediately dropped away, and D is rarely used. A/B/C/(D)/F exist, in effect, to mirror those separable levels of quality.
In fact, I'd argue that innate this 4-level limitation is one of the reasons many colleges (esp. Ivies) have such grade inflation in qualitative courses: with plus/minus grades, the three discernible levels of respectable work are mapped to A, A-, and B+/B, the one of mediocrity to B-/C+/C, depending on the professor's proclivities, and the truly awful work to C-/D/F... whereas a solid B (85%) in an intro science or language course is still a respectable grade.