I will say that while I rated "The Pegasus" a 5 I can't help but reflect that perhaps part of what makes it stand out is the episodes that preceded it. I've made no secret that in general I haven't been crazy of Season 6 and most of the Season 7 episodes I've seen so far. Compared to much of the S6 and S7 episodes "The Pegasus" seems brilliant. But candidly it isn't the best TNG has done. I think the 5 rated episodes from Seasons 2-4 are distinctly better overall. Indeed in comparing "The Pegasus" with "Parallels" immediately before it I think "Parallels" feels fresher and more creative.
I don't really agree with you, here. (Surprise!) Comparing Parallels and Pegasus doesn't make much sense to me, because they're from two different subgenres of TNG. (It's like trying to figure out if Wrath of Khan or Voyage Home is better, something I've always found impossible to do.) Parallels is a 5-star episode in the group of episodes that include Cause and Effect, Clues, and other Brage-esque Twilight Zone mystery-type stuff. In that group, it stands out wonderfully.
The Pegasus, while perhaps not as "original" as Parallels, is not trying to be. What it is trying to be is an intense political character-driven drama, along the lines of other great Romulan episodes, like The Defector, The Enemy, and Face of the Enemy. In that group, I think it also stands out very well. In fact, I think I actually prefer Pegasus to, say, The Enemy, and I think it's just about as good as The Defector.
What it has going for it, above all else, is the best character work for Riker the show has ever done. It also has possibly the best guest performance, from Locke. And, it also has the best ever "Picard tells off a crew member" scene - "I'll have to re-evaluate the command structure on this ship. Dismissed." Intense stuff.
Anyway, I think my point is, even if Pegasus had arrived in season 4, it would still be looked at as one of the top 20 episodes of the series or so.