I think you're right in that it wouldn't be as meaningful for a school with departments with only 10 grads, but I think it's unlikely that a department's chair

I think you're right in that it wouldn't be as meaningful for a school with departments with only 10 grads, but I think it's unlikely that a department's chair and faculty would care or even consider to mandate their grading to be curved in an effort to raise their student's GPA to compete with other departments. A difficult major is expected to have a lower average GPA than an easy major in any school, that's why latin honor thresholds are different for each department and different majors don't get considered for the same jobs purely on GPA.