Eaves I agree with much of what you said. I would like to add one thing in particular that might help flesh out what I am saying, especially in regard to Engineering kids washing out into the b-school. First, I think the B-school at Cal Poly while I believe to be fairly well regarded is probably nothing special.
There are lots of different intelligences out there. My wife is insanely smart, graduated with a 4.0 undergrad, and graduated with honors for her masters. Me, I barely breached a B average. Do I disparage her for graduating with a kinese degree and going into PA school? No way, that is something I will never be capable of. But could she pass a single midlevel engineering course, very doubtful. She is just not wired that way. For the record, she likes calculus. I could never hold more than three things in my head at a time, so I could never pass am entry bio or physiology class. As far as business majors, I think that many engineers lack the ability to being successful in business (I am guessing you agree). They are far too interested in the esoteric problems, what they deem “cool,” and lack a certain degree of vision and sociability. I am not saying business majors make up for their stupidity with personality, whip smart people exist everywhere, only their flavor of stupid tends to be different.
edit: Looks like the Cal Poly B-school is pretty good