Let me preface this by saying I don't play modern day leagues and I exclusively play stats only (ratings hidden) but I do have a lot of experience with fictional player draft classes. So I can not speak on the default rookies including in the modern day setup, I feel I have lot of experience with draft class and fictional player progression.
Now while I do think there are some minor tweaks still needed to fictional draft classes, I believe the results are very good and for anyone who is not seeing some 4.5 and 5 star guys on draft day living up to their potential, I am not sure what settings you are changing, because that is not what I found in this quick test.
I took an out of the box default modern day league using all of the quick start settings. I let in sim, with all teams entirely on AI control until November of 2041, stopping only to short-list the 4.5 and 5 star players (Scouting set to 100% accuracy) in the 2028, 2029 and 2030 draft classes. I forget to keep a screenshot on the 2028 draftees on draft day but have one included below for the 2029 and 2030 classes as well as a snapshot of career MLB stats for all of those players as November 2041.
To me that is a pretty good mix compared to real life. Early retirements are heavily skewed towards pitchers as you would expect due to arm injuries. There are players that lived up to the potential as well as plenty who didn't - just like a real-life draft. Now, it is very clearly a small sample size but based on that I believe the argument that
ALL 5-star players bust is quite simply incorrect or the person has altered their league setup, likely unintentionally, in some way to make it happen.
In fact, I would go as far as saying it is a huge improvement towards realism compared to previous version. We all know how many MLB draft picks bust and I have felt some past versions of OOTP treated draft picks like it was the NFL, where a first round was almost certainly going to be a very good to great player. In my mind, this year's version of draft class player creation and development -while still perhaps in need of some minor tweaks- is about as good as I have seen in any build of the game.
But that is just my .02 cents from a person plays almost exclusively fictional leagues.
EDIT- I should also add there were some non 4.5/5 star guys at the draft that received talent bumps and became 4.5/5 star big leaguers.