I completely disagree. I think promotion and relegation would bring so much to every North American sport, especially soccer / football.
The "investments being protected" leads to a boring league. In a system with promotion and relegation Chicago, DC and San Jose would have been relegated, or they would have been gutted and rebuilt in a desperate to avoid relegation. Instead, they trundle along, being bad every season but in no danger.
MLS has a top-down approach, and they "carefully curate and nurture" markets, but they're bad at it.
For example, they didn't create a franchise in Atlanta until 2017 despite the obvious demand. Once they finally allowed that franchise to happen, it has consistently set attendance records and won a bunch of things and is now one of the more powerful clubs in the league. Top-down control is only good when that top-down control is better than "the invisible hand of the market". With promotion and relegation, clubs find their natural levels. If a club has a strong fanbase they have money which helps them get promoted. If a club has a weak fanbase they don't have the money and tend to get relegated. Good ownership and management can also make a big difference. A rich but poorly managed club like Everton can struggle, whereas a relatively poor but well managed club like Brighton can succeed. With the MLS structure where relegation doesn't exist, and failure is rewarded by draft picks, good management doesn't have much of a chance to do anything, and poor management isn't punished.
Relegation also doesn't mean "killing" a club, it just means downsizing. Watch the "Sunderland 'Til I Die" series. Sunderland was a Premier League club then they were relegated in 2017, then relegated again in 2018. They have the stadium and fanbase of a Premier League or Football Championship team, but they were playing in League One. The series shows just how poorly managed the club was. They had a huge and loyal fanbase, but it took the pressure of relegation to get them to fix a number of lingering management problems. But, even though they had to downsize to fit their new budget, they didn't die. Eventually they got their stuff figured out and got promoted.
The "churn" of promotion and relegation is good for clubs overall, even if it punishes badly run clubs. Clubs can't afford to get lazy, or they get relegated. When they get relegated they need to take a hard look at their budgets and cut out all the fat. When they get promoted, the fact they're well run is rewarded and they have more money to spend in the next higher league. Sure, the owners hate it. But, who cares about the owners?
The baseball setup in North America shows how there's room for multiple levels to sports. MLB teams have stadiums with roughly 40k seats. AAA teams have about 10k seats. AA teams have about 7k seats. At each level the revenue is smaller, so the budget is smaller, but they can still bring in an audience.
As for this "mid-table liminal space", occasionally there are clubs that are not in danger of relegation, but also too low to have a realistic chance at a European competition. But, that's very rare, and only crystalizes in the last few weeks of the season. Last season Chelsea was mathematically in danger of relegation for most of the last half of the season. West Ham won a European competition, but they were in danger of relegation until the last couple of weeks. It's pretty rare that there's a football match in Europe where there's nothing on the line for either team aside from pride.
Meanwhile in US sports, sometimes there's nothing on the line for a club for months on end. There's no relegation to worry about, but also no chance of any kind of meaningful success. The playoff system in US sports makes it even worse. In many sports, more than half the league makes the playoffs. There's a little bit of value in getting a high playoff seeding, but to play the entire season just to get a seeding into a playoff leads to a lot of apathy about the vast majority of the games. You frequently see that in discussions of US sports. People who are casually interested don't ask "how is the club doing?" but "will the club make the playoffs?" If the club is anywhere in the top half of the table, the answer's yes. Otherwise it's no. Boring.
If NYCFC goes down, it means a big shakeup is likely at the club. Someone's getting fired. That's good for supporters of the club, and interesting for supporters of other clubs. If they come back next season, they will likely be a changed club. If Charlestown gets promoted, that's great for the league. It gives people an underdog to cheer for against the big clubs. It's huge for long-term Charlestown fans who finally get to see their club up against the big dogs.
As for the oligarchs deciding a rising tide lifts all boats... the tide lifts their boats. That's all they care about. It's a cartel where they don't compete against each-other. Instead they collude against the players and the fans so that their cartel can bring in the most money.
In a league with promotion and relegation, it's harder for those cartels to form because promotion and relegation means the cartel keeps changing. That means the owners are competing against each-other, not colluding with each-other against the fans and players.
Promotion and relegation is good for the sport, good for the clubs, good for the players, good for the fans, it's just bad for the owners.