I wasn't going to go here, but since this debate has continued, in football, due to the limited number of games, I evaluate teams largely based on proxy wins and losses, as much as anything.
For instance, Michigan's only proxy losses are Notre Dame (2nd degree) and Georgia (3rd degree), as a result of losing to Michigan State.
Conversely, Michigan has some okay but not great 2nd degree proxy wins over the likes of Tennessee, Vanderbilt, Kentucky, Minnesota, and Virginia.
In either direction, the nth degree W/L is less meaningful than the earlier ones (Michigan even has proxy wins over Clemson and USC, but that's relatively meaningless since they're so distant). If a team has a proxy win and loss to the same team (as often happens), I look at which degree was smaller. By no means is it a perfect system, but it usually works well enough.