Usage of "as" in a sentence
The "as" doesn't belong to the "or less", it follows on from "established its handicap". Let me put some brackets in to help identify the parts of the sentence:
"[A local bowling league established its handicap] [for bowlers who have an average of 200 or less] [as 75% of the difference between 200 and the bowler's average score.]"
Which could be rephrased as:
"For bowlers who have an average of 200 or less, a local bowling league established its handicap as 75% of the difference between 200 and the bowler's average score."