Whenever a good newbie shows up, they have no problem rapidly acquiring merit and ranking up. I don't think the issues is the lack of merits for newbies, but rather the lack of newbies making good posts.
This. Most of them tend to be looking for earning opportunities so it's best to avoid allocating MS's for these ranks.
If they don't bother to learn the ropes, then they don't deserve the Merits.
Still, I still see Merits dropped on lower ranks from time to time, so there's no shortage.
Isn't the below statement of yours in contradiction with what you just said?
That's not what I've seen. But if you stumble upon new users who make good posts and haven't received Merit yet, please post them in Report unmerited good posts to Merit Source. I'm still looking for a couple hundred good posts to finally empty my sMerit stash 
Based on my observations, it does happen
But hey, it's their rights to give whoever they please. And there are Merit giveaway threads from time to time so newbies still have a chance.