Colleges aren't like all-stars, there aren't levels split on talent. In general, D1 teams are better because they're from schools with bigger sports programs usually more money, etc. It's like high school cheering. However, HPU, for example, is D2 and are better than A LOT of D1 teams. It's college athletics in general, not just football - the only thing they show on tv (football, hockey, basketball) is D1 because they tend to be bigger and better, but smaller schools also have athletics programs. Did you cheer in high school or have any friends who did athletics? Schools only play against other teams in their division, even cheering. I don't really know what there is to get. A school with 40,000 students has more resources than a school with 2,000, so it kinds of evens out the playing field a bit.
However, NCA nationals (I'm not sure about UCA) also offers intermediate divisions within the big division (1,1A,2,3). These divisions are for teams who can't compete level 6 skills, so they have stricter requirements in what they're allowed to do. No standing tucks I think, not 2 1/2 high pyramids, no double (single?) downs, etc. That's probably where ASU would fall, but they could meet your definition of "not good" and still compete in regular D1 or 1A.
Splitting divisions by talent is pretty unique to club sports I think. Lots of travel teams (hockey, lacrosse) have A,B,C teams, cheering and gymnastics have it's levels, but schools for the most part are stuck.