I think when people are saying it has deteriorated in this sense they mean the job connections for non tagged/sponsored students. OAA and CTC have decent connections to help the individual student get a job, whereas FTE's ability to do this is less.
I know less about this side - but some have said that the instruction quality there is perhaps not as good as it once was. They have had problems retaining good instructors. Not so much of a problem for the sponsored students as they are normally monitored through the course and will be given the best instructors possible as an ATO will likely do anything they can to maintain or create favourable airline ties - but it is the independent student that could suffer from this.