All schools have issues to deal with regarding admissions. Some face difficulties because they are in an area with lots of schools with a similar profile, making it tricky to predict acceptances, some find they are low down the pecking order so have to vastly over offer to fill up, but do t know exactly how much to over offer by, others are constrained more by space than others, some are affected more by state school offers than others, some find in an individual year that external effects work to make more or less people accept than normal.
City is no different to other schools in facing constraints. All schools do and part of their job is to successfully manage those constraints so that they fill the school with the best pupils they can and avoid having too many acceptances. Schools know it's not an exact science. Most manage this by certain amount of over offering (more for less popular schools needed) and then using a wait list. If they expect to go to wait list, then those at the top are probably almost as desired as those at the bottom of the firm offers list. These schools keep in close contact with the top of their wait list, encouraging them that a place is fairly likely, so that the chances of acceptance if a place becomes available is higher. By keeping in close contact, the school can also gauge from wait list people if they have other offers in hand and how much they want to come and how likely they are to accept - so the school does have some control by using wait lists because they can gather information which really helps them, plus never have to offer to the wait list if they do t need to. Most schools successfully operate a wait list like this.
Given City's space constraints, I would think they need to be very careful about over offering and to actively manage a decent length wait list. As each 'no' is received, they can immediately offer to a wait list person, perhaps prioritising those who have said they are very likely to accept or will accept immediately. Other highly popular and over subscribed schools who fear a bulge class manage to do this, so I think City could too. They absolutely can avoid the bulge class by making extremely few over offers, by making clear they would like early acceptance, by enquiring as to likelihood of acceptance post offer and running very well managed wait list. This is a way to effectively manage it, which would seem fair to parents.
However, I can see that seeming fair to parents isn't City's key concern. They are confident enough in their application numbers to feel they can disregard this. The numbers they over offer to are all good candidates and rather than just offer the exact amount of places or a few extra too to the very top candidates and then face the possibility of not filling and having to possibly go well down the wait list to find people who haven't gone elsewhere, they prefer to have certainty of filling from that larger pool of over offers, all of whom they consider good enough to take, even if they can't be sure the very top ones will be the ones who accept fast enough to get a place. It is logical from their point of view, if they have decided they simply don't need to worry about upsetting parents because they will still fill anyway. It is a selfish approach and doesn't fit with what most schools do, but I can see how it is I. Their own self interest and they will justify it like that and in the context of parents holding loads of offers, which in the last will have forced them to go well down the waiting list to candidates they didn't really want, or to deal with a bulge class due to over offers.
Perhaps more of the very popular and heavily oversubscribed by parents who will get 4 or 5 offers and sit on them, type schools will feel forced to do this.
Not sure what the answer is because parental panic isn't going to be reduced, people will keep applying to lots of schools and so schools cannot be sure how many they have offered to will say yes, and come deadlines day, that can put them in a vulnerable position.