Perhaps there are logistical issues and/or fewer participants to consider but, why not use the same system for Master's road racing as Cross'; A(1,2's,elite 3's),B(3/4's),C(4/5's)? Set the age at either 35+ or 40+ and let the skill level dictate the category. If there aren't enough racers to support three categories just make two A(1,2,3) & B(3,4,5) or something like that. It would seem with the demo numbers it should be no problem to support at least two separate categories.

Master's races don't earn upgrade points (as far as I know) so it shouldn't matter to someone if they are upgraded from B to A etc...since there are no ramifications toward sanctioned upgrade, it wouldn't be difficult for the race officials and promoters to weed out "sandbaggers" and keep the best racers moving upwards. A couple of top 5 finishes in the lower category would pretty much indicate you need to move up.

Doesn't Washington use this format for road races?