Hey there,
Yes, you're absolutely correct in that they're not substitutes. But they're 2nd best options. To your point, however, yes, hundreds of people could qualify. That's where 3rd tier information comes into play (major, difficulty of institution, etc.). It isn't a science and it leaves a bit in the hand of the reader. The problem with not being given a rank is that you can't just make one up. And if you don't know, you have to be conservative. And if you do that, then adcoms will assume something worse than is actually the case. Let's say you're top 15% but you're not 100% sure, so you say top 20%. Then the adcom is going to assume you were 19% or something because you put the lowest number that applies. In this case, you're better off with your GPA and honors as well as any awards / merit based scholarships. Class rank isn't a requirement after all.
Bhavik