Just my advice, I've observed that any advantage a job applicant may hope to achieve by attending a brand name university is highly diminished if your results are below average. Which sounds fair, except that there usually is a correlation between university rank and course rigorousness. Unfortunately, there is no such correction factor in use by companies to give fair evaluation, and of course no one really cares. To the average HR, a 3.00 from Tier 4 Uni equals a 3.00 from a Tier 1 Uni. I've affectionately coined an abbreviation for the particular group I'm in, the F.O.O.G's (F**ked-Over Overseas Graduates)

Tldr; "premier" status university helps only if you're confident of scoring above average. Which average? The overall Malaysian average, not your university average.

Here is the rating of the local University in Malaysia, from T1 to T6.
http://www.mqa.gov.my/portal2012/D-SETARA/...%2037X26.1_.pdf
Indeed, you are right, lower tier uni have grade inflation, so the students can be "competitive" when graduated.
They are producing a lot of first class honour in the market, like a paper mills. 
Some MNC specifically recruit graduates from certain university.
The grading system and university not necessary can represent the quality of some students.