You could be right aplant,I may overestimate the revenue from competition n MMA that said it still is a revenue stream for some gyms I'm sure. I think a way of measuring how good an MMA school is is how well do it's members do in competition? MMA can be expensive ( as can BJJ). As both systems are relatively young there may be only a small number of quality gyms available. I'm not sure though.
I agree that systems like boxing and Judo remain relatively unsoftened over time. I don't think a combat system gets watered down just because it is popular. Other factors come in to play, such as financial considerations and philosophical shift e.g. The "do" in karate, which seemed to discuss karate as a vehicle for self improvement rather than some pure killing art. Karate history and politics aren't my strong suit though, so this is purely speculative!
"Let your food be your medicine, and your medicine be your food"