I'm not so sure about that. The TTTs are more likely to not have endowments to help them blunt the pain- meaning that they are basically operating in a model where cash coming in must go out. Therefore they must maintain class size or their school will fold. They also cannot give out huge scholarships to try and entice more students because that money is already allocated to other things.
Now if the T1s and T2s are taking students that normally would have gone to TTTs, the TTTs will simply just pluck people out of the 130 and low 140 range to fill their classes. Who cares about LSAT/GPA right? But then they are going to have a serious problem assembling a class where 75% of the students can pass the bar. Thomas Jefferson did- only 33% of their most recent class passed. If this continues, they might lose accreditation.
Luckily for TJSL, they can operate as an unaccredited school in CA where they are located. But some other TTTs can't. If they lose accreditation their graduates cannot sit for the bar. And then they either have to make SERIOUS cuts in class size, or they fold for lack of applicants.
I go to a private TTT. Though the school remained TTT in 2011 and 2012, it dropped about 10 spots. An e-mail was sent out in which the dean said they were going to decrease the incoming class in order to increase the UGPA/LSAT scores, which would mean maybe a higher USNews ranking. I don't really see what the big deal about the drop is. 110 to 120 or whatever is still TTT to TTT. This method will be... interesting... for tuition rates that go up every year. In the past years, the school said that tuition increases were due to costs associated with professors' salaries.
As for bar passage rates in my state, ironically enough, FIU (not sure if T3 or T4) had the highest passage rate.