Curious why it is bad? AP classes are bad then?...or am i misunderstanding what you posted?
I could see if all the smart kids are in classes together, then all the dummies are together and that could be bad in a way...so is that what you mean?
Yes, we have schools that still want the privileged few to all be in the class together for all subjects (tracking). They think it's a good idea to group the "smart" kids together so they can do well.
But:
When you put all the "dumb" kids in one class together you label them dumb. That does not create an environment for optimum learning. It creates an environment that makes them.. well "Dumb". Imagine being tracked since 1st grade and you never had to perform to the same standards as the "smart" kids. Throw in a difficult home life.. then you can easily see how they get to the point where they don't succeed.
If you mingle all the students together and do away with labels. You end up with a much greater % of the population that do well.
Advanced classes? Sure, you can have them and need them. Those subjects aren't for everyone, but removing stereotypes when structuring classes you find that many more kids do well.
This is basic stuff and nothing earth shattering, but we still have schools and principals doing this every year. Why? Is it prejudice? or just uniformed? I prefer to think its uninformed.