…a first-time player can win first place with a perfect long challenge division 2 score (and an unofficial division 1 score that would have been eleventh place there), and not be promoted to division 1?
By splitting the field into two divisions and (crucially) depriving ELO of any information it might use to compare players across the two divisions, I think you’ve made it harder than intended to move between divisions. If all that ELO knows about a player is that they perform well against players with ratings 0–1800, it will quite reasonably decide to place them near the high end of that range, but no higher: it has no way to know that their true skill cannot be adequately reflected by their performance against those players.
To be clear, I’m not mad and I’d never suggest retroactively changing the rules of past contests. I just think some future changes might be worth considering. Perhaps players in the high end of division 2 should be provided with the option of competing in division 1?