Not a done deal. The original report from the Edmonton Sun, for whatever that source or any source for that matter is worth to begin with (remember the hockey deal is as good as done reporting?), had this to say, unquoted in the sportsnet article:
Many NHL general managers, coaches and scouts in Innsbruck and Vienna for the world championship have varying degrees of belief, from being absolutely convinced this is the exact plan which will be put in place to feeling something similar would be approved.
http://www.canoe.ca/NewsStand/EdmontonSun/Sports/2005/05/18/1044803-sun.html
As for me, I hate the idea if it turns out to be so. It has far too high a chance that Crosby ends up on a loaded team. But move Crosby aside from the discussion, it has the likely result that several loaded teams will at least end up in the top ten and several teams far from competing will get the shaft and end up at the bottom.
As for the actually working out of this, according to the article Columbus, Buffalo, Atlanta, Florida, Pittsburgh and the New York Rangers get three balls. Edmonton, Calgary, Carolina, Chicago, Nashville, Los Angeles, Phoenix, Washington, Minnesota and Anaheim get two balls. Everyone else one. That leaves about a 27% chance of ones with one ball getting number one. 38.5% chance of two ball teams. 34.6 chance of a three ball team getting number one. If they put in that you could not drop more than 2 or 3 slots and the slots be based on point totals over three years though I could accept the system.