If I execute a conversion, I'll get back $1 worth of STEEM, instead of $0.8 worth as the SBD price would suggest. So, I'd receive 1 STEEM for be SBD 1, instead of 0.8 STEEM, which is 25% extra

No, it is not extra. The same amount of STEEM is allocated/reserved for each SBD regardless of the SBD price. Let's say hypothetically STEEM is worth 50 cents. That means 2 STEEM are reserved for each SBD. When a payout happens, if 1 SBD is being paid out, then 2 STEEM are taken from the reward pool and destroyed, creating 1 SBD. When you convert that 1 SBD back into STEEM, you get the same 2 STEEM you started with, regardless of the price of SBD. (If you, as a trader, are able to buy SBD for less than $1, you can make a profit, but the blockchain has no way to see this and doesn't operate any differently or produce any 'extra' STEEM as a result. You are profiting from other traders who either don't know they can convert SBD, don't want to take the price risk of doing so over 3.5 days, or don't want to wait, but again the blockchain has no part in this.)

The only thing that changes the ratio would be changes in the price of STEEM, not the price of SBD. If STEEM behaved like an normal healthy asset that sometimes goes up in value and sometimes goes down in value, on average this would result in no extra inflation. If STEEM (miraculously) went up more than it went down, it would result in lower inflation. In effect, there is a small degree of leverage, which is capped at 1.1x, meaning when the price of STEEM goes up, it tends to go up as much as 10% faster than it otherwise would and when it goes down, it goes down as much as 10% faster. Neither of these are terribly significant.

Unfortunately, we live in a reality where STEEM is not a normal asset, it is a toxic asset which mostly goes down, resulting in us seeing the negative side of this process more often (almost always). Fix that and any (mildly) negative effects from SBD also go away (in fact become mildly positive). But that's the trick isn't it?