Redo your math, 7 described 8 teams, not 12: 5 P5 conference champs, 1 G5 team (ie UCF this year), and 2 at large teams (UGA and Michigan for this year).
The problem with 4 teams is not that the #8 team "deserves" a title shot (though I could say that any team with 1 loss doesn't 'deserve' a shot either), it's that the CFP committee WILL take 'safe' teams with more established pedigrees of success so they don't get embarrassed. Taking UCF at #4 over an OSU leaves a lot more room for them to be made a fool than if they gave UCF the #8 spot.
As a team without a Bama/OSU/OU/Auburn/UGA/etc pedigree, 4 teams means we're a LOT more than just 1/2 as likely to make the playoffs. Lets take a scenario:
State has a perfect regular season, 12-0, but drops the 13th game to 0/1 loss UGA. UGA gets into the playoffs. Clemson and OU have 1 loss and won their conferences, so they're in. OSU has 2 loses, but they looked really good these past few weeks and won the Big-10. THERE IS A 0 PERCENT CHANCE WE GET PICKED OVER THEM, even with better wins and fewer loses to a higher ranked team. yet as we saw last year, Bama would get picked over OSU. The committee will be worried we're a flash in the pan and that we'll be more likely to get humiliated than OSU, because we haven't had proven recent success outside of that 1 season... But if there's 8 teams, we're playing OSU in the first round and are just as "deserving" of a Natty shot as the other 1 loss teams.
If you want the State's, SC's, WSU's, or UCFs of the world to EVER have a shot we need more teams. If it was about who "deserved" to win, then Clemson and Bama should be the only teams allowed to have a shot since everyone else dropped a game. LSU in '11 should have been handed the Natty no contest since they were the only team that truly "deserved" a shot. If the #5-8 teams are REALLY so far behind those top 4 teams then an etra game wont' matter since they'll loose the first round anyway. Was UCF the best team in the country last year? Probably not, but we didn't get the chance to see. Was TCU or Baylor the best team in '14? probably not, didn't get the chance to see. But I damn sure wish we let them prove it on the field, rather than letting the committee pick which Blue Blood gets the honor of being #4.
I have no idea how letting 11/10 win teams determine who's best on the field is "communist", but letting a few elitist ADs decide which 4 teams can have a shot is A-ok.