He still gets a clear-cut victory in 1v1, which means they are at the very least comparable. And even during their second clash at the arena, Kotal could still hold his own. Shao just can win the majority of the times against him, but it doesn't make him unquantifiably superior.
Shao himself in MK9 first loses to Liu Kang, but then he defeats the very same Liu Kang in Aftermath. The same happens with Kitana and Kung Lao, characters that are overall comparable to Shao and might get a victory over him (like Kitana did) but doesn't necessarily defeat him all the times.
That's because people hit by the Amulet or by attack fueled by it don't always get pulverized. We see the Amulet
overcoming Kotal's fire and then incinerating some soldiers, and also those powered by the amulet (Raiden and Shinnok) can
do the
same. But then, not all those struck by it are annihilated, as we have seen with Kotal.
Scorpion and
Liu Kang can also survive. Shinnok also was continuously tortured by Raiden's lighting, which where empowered by the amulet, without being turned to dust. This means that the medallion can either pulverize just beings far weaker than its user (or than itself) or that the effect depends on the user will, as they might decide to kill or not kill their victim. I don't see it too likely, honestly, as Mileena would have surely killed Kotal is she had the chance.