Placement Question.

[M.B.E.]

If your question is whether or not this is a good structure, that's just a matter of opinion. Nolan Dalla did a survey on this point about a month ago; you should be able to track down those results on either cardplayer.com or pokerpages.com (I forget which). Personally I don't like structures like the one you've described. I think that anyone who finishes in the money should receive at least a 2:1 payout compared to their buyin.

In the tournament you described, for the first few levels I would play "normally" (i.e. maximize chip-EV). As it got down to about 10 players left I would play more conservatively so as to increase my chance of making the money, tending to avoid situations where I could go broke, unless they give me hugely positive chip-EV. Also note that if you have a lot of chips at this point you can play aggressively and steal from other players who don't want to go broke.

Read Sklansky's tournament book; it covers this well.