I think it’s important for kids to clearly evaluate their level with the help of teachers and choose the school where that level is good and will be challenged, but where they’re not outliers. Getting a scholarship incentive when applying for admission is a strong clue you’ll be playing.
For instance, I don’t think a student who can’t make it into St. Olaf 's main (travelling) orchestra has a better shot at Oberlin conservatory.
I agree with @MYOS1634.
It sounds like @violinpopa your kid did not audition for a merit scholarship as part of their admissions application, and are now bemoaning the fact they neither got one nor made the higher level orchestra. I’m really sorry for that, truly. However HAD the child auditioned, they would have known clearly if their playing merited $$ scholarships. If not, then it would have been a pretty sure sign they were not in the running for the top orchestra. It was a mistake not to and hindsight is pretty 20/20 on this one.
And music scholarship availability beyond freshman admissions season could have been figured out with a single phone call to the school.
Olaf is a great school, and I assume your child was majoring in something besides music. S/he’ll get a great education.