Like you said, they can't control who is up or down in a conference, but they still play a lot of "name" schools in Power Five conferences. Maybe they aren't the top team from the conference that year, but Io_a and Nebraska don't play the top team every year either...
Who do they play that is not in a P5 conference? It's a pretty small list, especially since most P5 schools play 4 OOC games and 2 or 3 are usually against non-P5 cupcakes. Honestly there isn't much of a difference when you look into it.
Here are the Non-P5 teams on each schedule, followed by the number of ranked teams at time of play (including bowl games) played that year according to ESPN's website:
2015 (Umass, Navy, Temple) -
2014 (Rice, Navy) 5
2013 (Temple, Air Force, Navy, BYU) 4
2012 (Navy, BYU) 5
2011 (South Florida, Navy, Air Force) 2
2010 (W. Mich, Navy, Tulsa, Army) 2
2009 (Nevada, Navy, UConn) 2
2008 (San Diego St, Navy) 2
2007 (Navy, Air Force) 3
2006 (Navy, Air Force, Army) 4
2005 (BYU, Navy) 5
2004 (BYU, Navy) 4
2003 (BYU, Navy) 5
2002 (Air Force, Navy) 6
So to compare this to Nebraska and Io_a:
NU
2015 (BYU, S. Alabama, S. Miss) -
2014 (FAU, McNeese, Fresno St) 4
2013 (Wyo, S. Miss, S. Dakota St) 3
2012 (S. Miss, Ark St, Idaho St) 3
2011 (Chatt, Fresno St, Wyo) 5
2010 (W. Kent, Idaho, S. Dakota St) 4
2009 (FAU, Ark. St, LA-Laf) 5
2008 (W. Mich, San Jose St, New Mex St) 3
2007 (Nevada, Ball St) 4
Io_a
2015 (Ill. St, North Texas) -
2014 (UNI, Ball St) 1
2013 (N. Ill, Missouri St, W. Mich) 3
2012 (N. Ill, UNI, Cent Mich) 2
2011 (Tenn Tech, UL Monroe) 4
2010 (E. Ill, Ball St) 6
2009 (UNI, Ark St) 3
2008 (Maine, FIU) 1
2007 (N. Ill, W. Mich) 2
Number of ranked teams played from 2007-2014:
ND: 25
NU: 31
IU: 22
NU has the biggest cupcakes of the 3 teams, but they also played the most ranked teams.
I hate Notre Dame too, but they play decent teams. We both play in the B1G West. Is it full of great teams? No.
To say they play the 2nd or 3rd place teams, but not the 1st place is kind of crazy. Most years our teams never even played the best team in our conference either. What if they played 4 teams that were either 2nd or 3rd in their respective conferences in one year? That wouldn't be possible for those of us in a conference...
So who is to say they would play better teams if they joined a P5 conference?
In 2012 when they went undefeated until they were destroyed by Alabama in the championship game, they still played 5 ranked teams at the time of the game, but I still didn't think they should've been in that game.
Even with what I stated above, I do agree with you that they should join a conference.