hixn36, I think that's the right way to look at the problem. If people are getting paroled because we just need more information about them, then that seems sensible. If it's just a matter of resource constraints, though, there are probably some sensible reforms.
The trickier problem though is just what do we do with bad people that nobody wants. If we don't want to admit them and no one else will take them, can we then indefinitely detain them or are we obligated by some common sympathy to eventually let them in? I'm not sure but I'm inclined towards the latter.
If that's the case then we lose nothing by granting potential parolees legal alien status.