You do not do 50 damage, and the next 2 people do not do 150 damage + stun + whatever
A first level character hits with a sword and does 1d6 damage. A 7th level character hits with a sword and does 1d6 damage. One of them might be a fighter and get a bonus for strength if they have a high strength which isn't likely anyway - but that could be the 1st level character.
Now of course the first level character will die faster - which is why they are actually using missile weapons and not making themselves a target. This is balanced by the fact that XP is shared evenly not adjusted by level and thus the lower level character will shoot up levels in a flash anyway removing the "problem" in a handful of sessions.