Yes, it would discourage some candidates from applying if they see the average within that range is lower than the average they could get anywhere else. Dirty tricks are also a red flag for candidates.
However, while that range is an exaggeration, the truth is that salary ranges for positions are actually much wider than candidates may expect. There's a misconception that open positions have a single "correct" salary and that the negotiation process is all about getting the company to reveal that maximum number. It's not true, though. Ranges exist because even within a certain title, candidates have a wide range of skills and locations (especially when hiring remote/international) really do matter, whether or not you think they should.
More broadly, the salary range isn't even necessarily the only range they'd be willing to pay you. It's actually not uncommon to interview someone and realize that their career level is either above or below the position they're interviewing for. In that case, you "decline" the candidate for the position/title/pay range they applied for but continue the interview for a different position.
For example, if someone applies for SW ENG II but their compensation ask is in the range of SW ENG III (and their talents match) then you just bump them up. Conversely, if someone applies for SW ENG II but they're interviewing below the level of your SW ENG II candidates, you offer to continue the interview at the lower SW ENG I title/salary if they're willing.
So the ranges are still just a starting point. There is no magic trick to force a company to reveal the maximum number they'd pay you specifically. It's still a negotiation, but at least you can order job postings somewhat.
I actually think the bigger problem we're going to see is companies bait-and-switching candidates by putting a huge upper range number in the job posting but then offering them the bottom end of range while claiming that they can work their way up the range later. A lot of eager candidates are going to be pulled into companies who claim to have high upper limits, but who tell them they need to start at the bottom of the range and move up.
I am told that judges tend to be unimpressed with technically following a law in a way that blatantly ignores the intent; I suspect that if you tried to claim a larger range than actually exists in salaries you actually pay then they'd still find you to have broken the law. But IANAL and know nothing of the specifics; take with large grain of salt.
It says you have to post "the" salary range. So you can't have an actual salary range and then post something different. Most corps will have realistic salary bands and when they create job reqs it will be for a specific level. It's possible that some will call everyone engineers and have a band like that when you include interns. But that's not how most of them operate.
The state could publish an executive order stating "pay ranges for a given job post may not simultaneously cover three or more public servant pay grades".