There are at least two anomalies, of which I contributed to one of them, so I only have me to blame for that one.
First, MSU head-to-head defeated Michigan, and is ranked lower.
Second, Iowa defeated Penn State, and has a better record in conference, and has a better record overall, but Iowa is ranked lower.
But PSU beat Wisc, and Purdue beat MSU, and ILL beat PSU, and Rut beat ILL
But I guess your point is that if a team has a better overall record or at least the same overall record, and also won h2h then they should be ranked higher, which has some merit, I admit.
A couple reasons I put Mich above MSU. Mich's loss to MSU was on the road by 4 points. If they played on a neutral field, that suggests MSU would win by 1. Also MSU and Neb had to go to OT at MSU. In terms of power rankings, I have decided to treat any OT games as ties. So MSU's record is only 5-1-1 in my world. Thats enough for me to put Mich above MSU.