Chops, I don't want to step on any toes here, but I read that 3 times and still had problems following it. Here's what I think you are saying though, and from my understanding of the apps and private threads.
When an app gets sent in, if you have it set to private, it does a who should recieve this thread check, and assigns everyone that was an officer(or whatever rank you have it set for) access to view the application thread. It only does that check and assignment when the app is submitted, so only new apps will be assigned to your new rankings. Nothing retroactive.
Even if you changed it from private to non-private and had them posted only in a specific thread tag it probably wouldn't help, since I don't believe the system will reparse all the old apps.
Or...to make a long story short, working as intended