A quality team does not start and end with pitching. I won batting average by a landslide .360 to .290. Is my team less quality? I lost era by less of a margin than that. Yahoo should not make the determination by one stat it is unfair.
The way I see it. Any tie break rule is fair...so long as it applies to everyone in the league (which in this case using ERA does). Just because you didn't know about it; it doesn't mean it was unfair...it means you didn't read enough (or pay attention to enough) of the rules.
That said...I actually do agree with you that the commish should have the ability to set the tie break rules at the start of the season. I mean he (or she) sets other rules like what stats are to be scored, max number of moves, max innings pitched, etc. etc....the list goes on. There is no reason that the type of tie break rule should not also be an option.