I've seen two drafts and it's totally random. In my first year, Triple H and Husky Harris went to Smackdown and Goldust (I think) and Sheamus came to Raw. In the second year, ADR went from Raw to Smackdown (I can't recall who else was involved). The good news is the draft can: a) be turned off and b) essentially vetoed by editting a guys brand.
In a related note, I've straight simmed two years worth of Universe and have no problems with any of the title reigns I've seen. If anything, guys seem to hang on to the belts too long. I haven't seen any jobbers rise through the ranks to claim a belt, though several have earned title shots, including Slater, McGillicuty, Otunga and Goldust. Goldust actually had a brief run as IC champ, but it lasted only one month.
Major title holders have included Cena, Punk, HBK, Undertaker, Sheamus, Orton, Christian, Mark Henry and Triple H -- I may be forgetting one or two, but these have been the most dominant guys in my Universe, as they should be.