Hot take: prizes don't really impact the size of events.
Of the 3000 entrants into Smash there, my guess is 2950 of them know they have zero chance of making top 8. What counts for them is the event itself.
The reason EVO, CEO, Combo Breaker are the top 3 US events is not because of prize pools, it's because of the prestige of the events and in CEO/CB case, the amount of community stuff making it a better experience for the average pot monster.
Sponsorships are what makes pro tours work. I believe you can make the argument that top players draw out pot monsters too, but I think most pot monsters (I've been one for a long time) do it for the community and love of the game. To be able to fly out to all these pro tour events is expensive- my guess is 20 majors a year costs around $20,000 or so, mostly in airfare/hotel.
We've seen two games this gen (SCVI and UNIST) succeed without real support for their publisher as well. That was all community effort. SCVI got a pro tour and a Season 2 through their community efforts. Grassroots is the biggest factor in growing games. Smash, SFV were going to be as big as they are no matter what (and in SFV's case, despite Capcom's ability to annoy their playerbase)
What we really need are more top tier events.