The “problem” with the closed-league concept is that it removes the hope, for supporters, that ”life will get better”. The football pyramid is the European version of the American Dream; turning the top competition in a closed league would be like amending the US constitution to introduce castes: everyone knows it wouldn’t be that different from the status quo, in terms of actual social mobility, but taking away for good the possibility would be an affront to the cultural fabric of society.
It's even worse that that since there are incentives to finishing near the bottom of the table since it gives you access to better players in the next season via the draft. There are several occasions where bottom ranked teams have been accused of throwing late season games so they can finish even lower in the tables.
That's why it's deemed "not competitive" by European standards.
On the other hand if you look at the diversity of teams that have made it to the Super Bowl the past 20 years and compare that to the diversity of teams that have finished in the top two in the EPL or La Liga the past 20 years, then it looks a lot more competitive.
The bonus of winning the league would have been minuscule compared to the profits from merely participating (and this goes only for the founding members).
Hence it would have definitely reduced competition.
The ESL would have been a show league, possibly even more so than the American leagues from which it took the ideas.
This was an all too transparent money grab.
Yes, the most annoying factor was that it cut off the Football pyramid and would have had incredibly negative consequences consequences for all other teams and countries.
However, even if you are a fan of the participating teams, I wonder how long you’d be excited watching a league where winning is a sidequest.
It’s just bad all around.
Now, naturally, "fans" is a bit different concept in North America, as they're typically peons who start cheering for their newly relocated team because they have a funny logo.
Concretely, the ESL wouldn't be a sporting competition, it would be an entertainment spectacle.
When there is nothing to lose in terms of relegation or missed qualification for performing poorly across one or several seasons, we are no longer dealing with a competitive sport.
And football fans, i.e. the grassroots, don't typically take kindly to attempts at crafting new artificial rivalries and watering out those rare, big occasion games by playing them with absurd frequency.
Add to that the frankly quite disgusting narrative of "doing this to save football" and it's just a perfect shitstorm, really.