They turn people away because they are so popular that too many people apply.
If they had fewer applicants than places, they wouldn't turn anyone away.
Families want their children to go to these schools.
All over-subscribed schools turn children away, according to their selection criteria. Single sex schools discriminate half the population; grammar schools discriminate; most schools discriminate against children who live on the wrong side of the street.
A school that is "good" should not be abolished. They should be emulated.