There are many situations where some individuals either choose not to compete or are not allowed to compete due to allegiances to one federation or another - how can the "overall best" ever be decided? It can only ever be "the best player/team out of those who chose or were permitted to enter the tournament, based on their performance in each individual match at that moment". 2nd, 3rd, 4th etc places in a knock-out tournament are almost meaningless. World rankings which aggregate the results from all tournaments a player/team competes in are supposed to address this, and are probably as close as it is possible to get.
What annoys me is the Baseball "World" Series, where only teams from America play!