There were tons of ways to advertise selling your used car (e.g. most towns did and still do have a high traffic spot where people will go park the car with a for sale sign, or - more directly in competition with local papers - were car classifieds publications distributed for free. These cost more than newspapers to place an ad and tended to target the enthusiast market).
Besides that, newspapers competed with each other. In the heyday of print, it was pretty rare - almost unheard of - that there weren’t multiple publishers in any market, even small towns. Kind of the anti definition of monopoly. Hell, the US constitution literally encodes the right for anyone to publish a newspaper. Even now, most markets have several options for buying print classifieds.
An “expensive” offering from a variety of vendors that happens to be effective is not a monopoly, it’s just businesses pricing at value not cost.
The $50 was what many people, apparently, were happy to pay to have their ad distributed daily for a few weeks, on paper, delivered to the homes of thousands of people. Look up the cost of a full size ad in a print publication, and classifieds look like a pretty good deal.
Citizen journalism has issues, too. Many of them are resource issues, so supporting things like a cap on fees and short deadlines on FOIA requests, would help a lot.