[kspacewalk2]

It is, among other things, a way to adjust for the quality of evaluation and/or the quality of teaching.

[airstrike]

I know that's the argument but it just leads to grade inflation and a diluted signal for the students ability

Any specific uncurved grade is already ultimately adjusted by the being put in a basket of other grades that the student obtained across many courses, which are generally uncorrelated (or at least just as uncorrelated before curving as they are after)