I have a suspicion that Challenge Rating might actually range from 1-10, and that monsters are suitable for parties whose level is double their CR.
Eeeehhhhh.... I'm not sure about that. I mean, if C5 really means "suitable for 10th level parties" why not just make it C10?
I think the C½ creatures are a special case to accommodate 1st level. If we look at my threshold hypothesis C½ really just indicates monsters that a 1st level party is going to be fighting multiples of by default. Like let's say Orcs are C½ (100 xp) and Goblins are C½ (50 xp): both are suitable for a level 1 party to face in small groups, but orcs should be used in fewer numbers than goblins. Then let's say a hobgoblin or a gnoll is a C1 (200xp) creature. A level 1 party shouldn't be squaring off against more than one at a time, and a hobgoblin + 4 goblins would actually be a Very Hard encounter. A C2 Ogre is an inappropriate challenge (it does enough damage over its average combat lifespan to easily murder multiple PCs), and a Very Hard encounter all on its own.
C½, then, would only exist so that there's a C# lower than the lowest party level. Once you're level 2 the lower-than-party-level C#s start piling up, so there's no shortage of goons to send in clusters of various sizes.
That makes this, basically, a reworking of the 3e CR system, of a sort. Just ideally without the assumption of a party of 4 underpinning the math, and with C#s that accurately reflect the reality of the monster difficulty. (CR was needlessly obtuse to calculate, but the real nail in the coffin was the fact that more often than not the numbers were just plain wrong.)
I'm kinda extrapolating this from their stated goals, that they want the "number of DM options to grow, never shrink." My reading of that is that the platonic ideal is that the party is by and large always facing off against groups of creatures their C# and lower, by and large using quantity rather than level to adjust the challenge. So the C# isn't the "this is when an Ogre is an ideal challenge" but instead "this is the earliest Ogres should show up."