At the start, team 2 continues doing awesome, and while team 6 doesn't win, they improve. Next round Team 2 isn't doing quite as well, but still good. Team 6 has improved a bunch. After a couple of rounds, team 2 is falling apart and team 6 is now winning (or 2nd place, I forget).
My experience, admittedly anecdata, is that great teams perform well when they're in an environment where they're allowed to succeed. I've worked with great teams who did terrible work, and it was pretty much always due to a bad environment (e.g. an owner who would redirect their efforts every few days, so no feature ever got to done-done). I've also seen (but not personally led) teams that I had originally somewhat written off, who under good leadership managed to do some pretty damned impressive work.
And don't get me wrong, I'm not devaluing the potential contribution from a single amazing person, or a team full of amazing people. My clients hire me because I have a (locally) rare set of skills that their team doesn't have, and help them get over hurdles that their team can't (currently) tackle on their own. But if you take a great set of individuals and put them together in a shitty environment with a shitty leader, you're going to get what you get.
What if there is no reasonable and reliable way to become a good team, and the only way to go from a bad team to a good team is to replace most of the team?
I suspect the same can happen with software developers.
Of course, there are people that will be bad anywhere and top guys that will be great anywhere.
I don't think that's the world we live in though. I've seen smart, sociable, effective developers fail in misorganised teams, and I've seen teams of ordinary people produce very good software by getting their processes right.
I don't doubt that there are bad developers---I've definitely encountered them. But software development is a team sport, and it makes no more sense to just "recruit good people and leave them alone" in software than it would to do the same in basketball. Great teams have both talented people and winning strategy.
That's surprisingly common across the field. Most developers work on small teams doing small but often very long lived projects. Code staying in production for 30 years is surprisingly common outside of SV.
Of course that's your experience. If you judge teams based on outcomes, then you're going to conclude that teams that succeed are good, and teams that don't must be bad. Unfortunately that offers no guidance in how to become a good team. The goal of software management as a practice is to find patterns of positive behavior that make good teams. Agile, in general, is a collection of those patterns.