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I've heard it said the reason Ivy Leagues don't offer merit scholarships is because the entire student body would qualify.
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Not Germaine to the topic, but FWIW it's athletic scholarships that are not available at the 8 Ivy League schools. (The Ivy League is just a collegiate athletic league, after all.). There's no particular restriction on academic scholarships.
I think McLovin's assessment is correct--this is just a money-making endeavor on Stanford's part.