I think fake players came up in another topic before. There's a couple problems, the first being that modern gamers arguably want and expect complete authenticity - so fake teams and players won't cut it and trying to create a new game from scratch, populated with fake teams and players is almost a death sentence.
The 2nd is, from a legal standpoint, developers now have to be very careful that the fake teams and players don't too closely resemble their real-life counterparts. That's why there's no NCAA titles anymore - it's too risky after that former college player took EA/NCAA to court claiming they used his likeness despite the player representing him being named after his position/number. Everything else about the player in the game - his stats, appearance, etc - resembled him and the courts ruled in his favour. So that's gonna increase the workload, not only creating fake players but creating fake players that don't even mirror the real players. It's a legal nightmare and removes another layer of out-the-box authenticity.
I do think it could be worked around, though...
For our brand of football over here, the big competition for games was between EA's FIFA and Konami's Pro Evolution Soccer. The gap is a lot wider now, but 10-20 years ago Pro Evo was serious competition to FIFA and had the superior on-pitch experience for 'proper' football fans. It lacked licenses, had far fewer teams, had it's own weird-but-engaging fictional league system and had fake player names - but it was always clear who they were meant to represent. The teams were super vaguely named, though. In the PS1 generation and before, unlicensed teams in football games were just named after their city. So Manchester United simply became Manchester, but Pro Evo for some bizarre reason called them Trad Brick. Liverpool, whose name never needed to change became Merseyside Red - less cryptic but still sounds silly. Don't get started on the London based clubs, all named London but prefixed with North/South/East/West and suffixed with the team colour. Any fans of North East London White (Tottenham Hotspur) in the house?
It definitely hurt the game's sales - but it had a great reputation for being the more realistic game at the time. 'Proper' fans/gamers played Pro Evo - despite the fake teams/players. The thing was, everything
was customisable. Team names, flags, club badges, kits, and a special spot for the kit manufacturer and sponsors logos. Even the few licensed players could have their attributes and appearance changed - except their faces. Wanna turn David Beckham into a 7-foot goalie with a pink afro and mutton chops? Well, you could.
You could also download other peoples save files from the internet if you had a compatible USB stick. Other gamers had scanned and added authentic badges, sponsor logos, etc, and edited all names/stats to be accurate and you'd end up with something that looked totally genuine. This was before internet connectivity was standard in gaming. I haven't played any of the games for a long time, but I think similar online kit editors still exist, and they are applied as skins, cos Pro Evo still
lacks licenses. I'm surprised the series is still going, FIFA's gameplay eventually caught up and became superior - but it probably helps they have a long history of competing with FIFA (as far back as the Mega Drive) and enough people must still want an alternative to EA. I don't think it would be as easy to compete with Madden after all this time without an alternative, though.
But even looking to modern licensed sports games, you can create draft classes, custom players, rosters and share them online. Even WWE games let you create wrestlers and share them online. You can create logos, arenas, rings, etc. It's totally possible to buy a WWE game and use it to simulate a rival promotion - even from 20 years ago.
A rival to Madden could be successful if they focused on gameplay and gave users complete freedom to edit everything. If the game itself was good enough they could totally rely on the game's community to provide all the NFL rosters, all the players, teams, logos, etc and just allow people to share them and edit them themselves. There's people who already do that with old games; NFL 2K5 is modded every year to update the rosters. As long as they're vague enough about their intentions, it could get around the legal loophole. But would any developers wanna take that risk, especially if EA/NFL realised what they were doing?