The point that the ordering of optimisation and allocation phases is important in negotiation is a good one. But as you say, the phases are more often interleaved: the analogy isn’t exact, but I’m reminded of pigs playing game theory
I disagree that this maps to mistake / conflict theory very well. For example, I think that a mistake theorist is often claiming that the allocation effects of some policy are not what you think (e.g. rent controls or minimum wage).
It seems weird to describe the system as “simpler to model” when it seems more that “the best model is simple”. Like, I can still use a coin flip model for the list of numbers if I know all the numbers; I just also can use a more complicated, more accurate model.