As for the broken rung, maybe tweaking it a bit? Instead of picking one game against the spread, pick two. Get both right and move on, get one right and stay in place, get both wrong and down you go.
I like the idea of this, if not the exact challenge. I think something that can be a win, a push, or a fail would be a good challenge. A good balance for me would be something that works out to around 20% pass chance, 70% push chance, 10% drop chance (for the epic fail). Of course percents are just theoretical, but the idea that it's hard to move on, but a really low chance of a full fail. I'm thinking something like "Pick at least 3 games (up to all of them) using the spread. If you get 3 wrong using teaser rules (you were wrong by more than 6 points), you drop down. If you get 3 right under normal spread rules, and didn't hit the fail condition, you advance. This way you could take a bigger risk for a high chance of success.
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Rydia