Separation Criteria is just that. It's designed to "separate" top 4 placers so they don't see each other in the first round. That could look different from bracket to bracket depending how many top 4 placers there are. They have someone on Friday night that goes through every bracket to verify the top four placement in the style being wrestled. There are a lot of people that claim separation criteria who don't have it. Once the brackets are made the program in track separates the wrestlers in the bracket.
The ISWA is working with track to have a weighted ranking system for ISWA state events that take several types of tournaments in consideration with one of them being IHSAA State. Now this will be done with a program so it probably won't be perfect either.
As MattM stated above, "Probably should be happy they have any sort of separation criteria and regular brackets. Back in the day it was straight luck of the draw and in verticals brackets where if you lost round 1 you were paired with a winner from round 1 in order to help decrease the field quicker."
The ISWA is wanting pairing officials so please sign up and make it better. Set up mats, run wifi, take incessant phone calls with people bitching, get yelled at all day by people who have no clue how to run a tournament, get less sleep than anyone in the building, no breaks, and no pay all for the love of the wrestling community. Come get ya some! lol