It does seem unfair, I lived in a house of two students and two non-students for a year, and we ended up just spliting the council tax bill (I was one of the students)
I think Rich has explained this very clearly. If you are the sole occupant of a house you pay 75% of the full council tax, so if there is one non student they are effectively the sole occupant.
Although it seems unfair, when you look it it like that it does sort of make sense, and would be unfair to other people who live alone if it was any different.