Newcastle population 546k.
Sydney population 4.576mill (includes central coast).
9 teams into Sydney area = average 508k people to draw from each (including central coast).
Newcastle average crowd (2014) = 17151. Adjust to 508/546 = comparative crowd of 15,957 (relative to 'fair' areas and Sydney clubs.)
List of average 2014 crowds for Sydney clubs, showing Newcastle's position:
Souths 21,095
Parramatta 18,963
St Geo/Illa 17,717
Canterbury 16,636
Newcastle 15,957
Wests 13,458
Cronulla 12,879
Roosters 12,778
Penrith 12,363
Manly 11,983
So, Newcastle are basically a 'slightly above average' Sydney club (if we are using the argument of 'relative population'). None of those Sydney clubs have the advantage of a 'boutique' 35k suburban ground either.
By the way, I think the whole thing is a poor argument!