Don't think you need to worry too much about derailing this thread.
I agree with your take on larger playoffs not diluting the regular season in this case. In pro leagues where there are only 30 some teams, expanded playoffs can make the regular season less interesting because like half the teams make it. I know this is definitely the case in the NBA where the regular season is pretty meaningless.
In college football right now you only have 4 of the 100+ FBS schools making the playoffs, so even if you expand the playoffs you still have a small percentage of the total eligible teams making it. Now granted, a good chunk of those "eligible" teams have little to no shot of ever making the playoff.