Wow, I hope you got a good stretch before taking that huge leap...
I didnt say we "kinda did away." We DID do away with them. We are very clear with our students about placement: Things like region band/solo & ensemble/rehearsal attendance/Weekly playing assignments are the biggest factor in determining their placement and we have a massive spreadsheet with all of this data in it. Honestly, we think that viewing our students individual trends over the course of the entire year is a better indicator of where they should be as opposed to one shot at an etude. So, I would say they have more of an opportunity compared to one audition. We also are able to move some students at the end of the first semester if we really think it is in their best interests. I regularly had kids who did not want to audition at all and would say "can you just put me where you think I should be. I trust you" DONE!
When we used to do auditions, we had constant complaints from students and parents who thought their kid should be in a higher band which was based on nothing, because we recorded them and were able to play audio comparisons of students in each band sound like. But that didn't matter to them. Since we ended this process 5 years ago we have only had two complaints (I still find that hard to believe) and those were scheduling issues which were out of our hands.
The culture in our district is not super competitive, so we have a lot of kids who just like to play in class and are good kids. In addition, I have had many conversations with students like this: "Hey, we kinda have you on the fence between these two bands. We can put you in the higher band where you'll be at the bottom of the section, or we can put you in the next band where you'll be playing first on most music, and you can lead the section in that class." They usually choose the latter.
This only works if you really know your kids/parents and more importantly if they trust you. From the rest of the replies here, it just seems like most people audition to CYA. Our admin supports us. Every program is different.