Though I agree with what you are saying, I don't think it is fair to say that RL is in denial about it.
The vast majority of the people that matter have understood what's been going on for decades now, they just either haven't had the power or the will to do anything about it.
You should also never underestimate the power of self interest in RL. There are people in RL who would effectively kill it as a commercial product if they thought it would benefit them or their team in some meaningful way.
Trying to hold what they already have would just put them into a war of attrition that they'd inevitably lose as other sports got bigger.
They have to be bold and fight back, and that means being entrepreneurial and taking risks, like decoupling the NRLW from the NRL so you have two products to sell instead of one and have a bunch more pro-teams to spread across the country to help sell the game.
I'm sorry, I couldn't resist lol.
I don't have faith that RL people can detach themselves from their emotions enough to make relocations work. They'd focus too much on the past instead of the future and turn their new potential market off as a result. I can just imagine the Daily Telegraph running annual articles of rumours of X returning to Sydney and the damage they'd do.
I'm much more in favour of clubs being relegated and their license being given to new entities. That way the club that gets the boot still exists and operates more or less how it always has, and it creates the opportunity to build the lower tiers into legitimate alternate products that can be sold in their own right (see Newtown's growing success in the NSW Cup). And trust me as a Bears fan, standing alone in the NSW cup is way better then the merger was...