Actually, I think the point you made above Nath is good as you have actually addressed the fact that this IS going to hurt the grass roots of the league. That is my major concern. I Don't blame NSW for anything, just the thinking of management on prizepool distribution. It seems a little cold and not thought out.
I completely agree with this process hurting the "grass roots". Before I explain, I just want to mention - even if you take APL/NSW out of the equation. I am very sure that SA prize pools would have continued to decrease anyway. As Tim has said, the prizes pools in SA are a direct reflection of the forecasted active player base of SA...
Now to continue on with the hurting the "Grass Roots" comment. I agree with this because of the following:
Regular in venue games are the crux of the FHG income/revenue/profit. Yet your chances of qualifying into the ME through these games incredibly small, almost none existent with the exception of getting through to the State Finals and finishing in the FT. Although the ME sounds amazing, it does not support the league at the grass roots (beyond the minimum participation rule) and only serves an arbitrary "end game" in which makes you play events outside of the normal schedule.
With all the focus on the ME and the diminished prize pool of the State Final, I believe players are less likely to want to participate in the regular games as there is just not enough value. Although the value is the correct value, it's not enough...
The whole point of pub poker is to give the masses the social enjoyment of the game, keep it more accessible than the casinos/real gambling and yet maintain the opportunity of some great prizes pools. It seems to me, the league is more focuses on creating events that parity the casinos and their prestige at the expense of participation and accessibility.
If FHG could some how create strong avenues for success/qualification through their regular games exclusively and drop the need for satellites and auxiliary measures to generate tickets then I think they would have a real winner. More people in regular games means more money for FHG and better prize pools for players. More time/money spent on all these satellites and auxillary measures means less players in regular games and less money into FHG.
All in all, my opinion only....