We were faced this issues for my son. The only issue was we had a rare instance of 12+ boys who had an overall athletic aptitude. The problem was the town really didn't care and the coaches pushed their own agenda. The year had enough boys to carry two teams; the last 5/6 boys to round out the "better" team to 17 players and the top 3/4 on the second team (18 players) were hard to split and yes favors came to play. But many of the parents of the second team fought the process because they didn't want their son on a second team. Felt things were done sneaky. You realize after the years there is no easy way to do it.

I always thought PAL you split evenly and you form a "tournament team" of the better players. You practice twice a week. One as a grade and one day as a team (with the option of a second team day before games start).

I think the school coaches should have some involvement though. I've heard all the nightmares. Lived through a few. Good luck have fun and remember you are their parents and advocates. The boys will be friends for a long time they are building lifelong memories.