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The number of students appearing for the exam does not mean there is more screening. By that logic, NLSIU and CNLU provides same level of screening.
The interview component has been dropped. Anyway, just check the number of students who sit for CLAT vs number of students who sit for NLSAT and you will get a sense of "more screening".
Says who? They get to be chosen by interviews other than NLSAT, which is way more screening than CLAT students get.
Everything needs a revisit after some time. What may be true once upon a time may not be true later. 3 year LLB at NLS was introduced to get good students, and in my personal opinion it's a well structured course.
A 3-Year student from NLSIU got Rhodes last year, so quality is certainly not poor always.