They would if people really wanted to go. Still takes an hour to get into MCG, Marvel or AAMI if driving from most suburbs. Melbourne has the same population as Sydney but is more spread out. Yes, our PT is much, much better, but the fans all whinged when the AFL closed all the suburban grounds. It is shame that there are no games at all at the traditional venues, but for the financial good of the game it was the best move they ever made. It took people a few years to get used to, but the end result was a 50% increase in crowds in Melbourne and Adelaide, and all teams now have fans all over the city.
You can upgrade the suburban venues over time like what is happening at Manly. Keep the capacities 15K - 18K and play half the games - those v other Sydney clubs at SFS, Homebush (not many) or Parra. After a few years of whinging the crowds will climb and these big games will have 50% higher crowds with roughly half the crowd supporting each team which is how it is in Melbourne. The key to growing crowds is opposition supporters.