Not convinced it will work for expansion clubs if it is bolt on to nsw and qland cups. Reality is there is nowhere near the strength of player depth or money available in wa, nt, vic etc to put out competitive sides. It would decimate the quality of the local competition and the team would get good hidings from nrl linked reserve grade teams. I struggle to see the value of such a set up.
To be really radical you could create three divisions with promotion and relegation but travel costs would be ridiculous. Then somewhere likeminded WA could eventually build and work their way up the divisions. We struggled to filed a competitive Jim beam cup side with a number of blow ins from England, east coast and nz.
Which is why a total restructure of the second tier is necessary, and also what Richo suggested if I remember correctly, probably also why he got the sack because the NRL and ARLC would want a cheap quick fix that doesn't rattle the boat and a complete restructure of the second tier, that probably includes taking control of the competition/s away from the QRL and NSWRL and taking junior development out of the hands of the NRL clubs is none of those things.
Personally if I was in charge I'd set up some sort of player loan system instead of the clubs linking with second tier clubs, similar to what they have in England, so every player not in an NRL teams top 17-24 is 'loaned' to a second tier club, this way one Cowboys player could be playing for the Blackhawks and another for the WC Pirates in the second tier, in theory anyway.
Of course that system actually working would be reliant on the second tier being completely independent from the top tier, which would be a big change for this sport in this country.