262 is about 99.4th percentile. If I understand correctly, you are talking about 2 grade acceleration, correct?

If so, I don't think that limiting this automatic qualification to a little more than 1/2 percent is out of line. Pure test-based automatic qualifications should be set fairly high. Acceleration below that should be looked at on an individual basis, which it sounds like it being done here. A good teacher will have a better handle on readiness than a number from a single test