1) Jaejoong and Yunho entered school a year earlier - in that case, grade level overrides actual age, so anyone born in 1986 but who's a grade below them would have to call them hyung.

I recall someone using the same rationale to explain why Donghae and Eunhyuk call Sungmin "hyung" while Donghae doesn't call Eunhyuk "hyung" even though they are all born in the same year. I suppose it makes sense...but the system must be confusing since you have to figure out the year, and sometimes the month, of all of your friends and acquaintances in order to determine whether an honorific is needed.
With all this attention on age, do Koreans tend to remember their friends' birthdays better? ;D