For us, a A in an Honors course got 5 grade points (rather than the 4 standard), so doing really well in Honors courses put you above someone who did really well in non-Honors courses. The amount of work required, however, for a B in an Honors course was far more than for an A in a non-Honors, so for anyone who wasn't going to be getting top grades, their GPA would suffer.
Of course, they are the ones who were more successful in university.
I think the honors kids at my school were mostly headed toward college, so they made their decisions based on what would impress admissions officers. It might be different now, because Texas now has a 10% rule that grants a scholarship to students who graduate in the top ten percent of their class. (For a couple of years you got automatic admission to the state school of your choice for graduating in the top ten percent, but that resulted in half of UT's admissions going to 10% students, many of whom were very poorly prepared, so they changed the rule.) There were probably a few kids in my class -- very hard-working and curious but not as bright -- whose GPAs were hurt by taking honors classes, and they probably fell out of the top 10% because of it. There's no way anyone could crack the top 1% or 2% without taking lots of honors classes, though.
It's possible our honors classes were less rigorous than yours, too. As I pointed out in a recent thread, AP classes at my school were noticeably more rigorous than honors classes, because our normal honors classes wouldn't have been sufficient preparation for an AP test.
Of course, they are the ones who were more successful in university.