This is a terrible idea. Teams should be selected based on quality wins rather than avoiding losses. If it's just based on being undefeated why would teams ever schedule anyone decent out of conference? Play a bad FCS team, a bad Sun Belt team and a bad MAC team to make sure you run the table before conference play, that's going to make for great football in September. The fact that Western Michigan beat a bad Illinois team and a 6-6 Northwestern team is not a reason for them to be in the playoffs.
In recent history mountain region teams that have gone undefeated have cracked the top 8 but had trouble cracking the top 4.
Utah's undefeated team finished #5 before bowls and I believe was #2 or #3 in AP poll after bowls. It was the second most dominant team in college football history statistically. Boise State also had a couple teams where nobody hotly debated them as top 8 range but did debate if they were top 4 worthy.
I agree it shouldn't be as simple as "undefeated" or "not undefeated". But there have been several MWC/WAC teams in the past 15 years that clearly earned a birth in any college football playoff that would have been denied in a 4 team playoff and not an 8. The fact that Meyer's Utah team would have been out of a 4 team playoff is one of the best arguments against 4 teams in favor of 8. That team was literally the future of college football and one of the greatest ever.
I'm not throwing every undefeated non P5 team in the top 8 either, just pointing out that many have earned that classification and proven they deserve a shot in a playoff system if we can call it that. Dropping TCU from 3 to 6 for little reason should make everyone realize that a non-P5 or non-ND team will never make the four team playoff with this small committee 4 team setup.