We’ve had $500 max bet (our version of no limit) in Washington State for years, in many casinos all over the state. Those rooms are always busy. Some smaller rooms won’t offer it, because they see it the way that you do...and it would probably kill them. But those that are known as the better card rooms offer $2/$5 and $5/$10 and do just fine.
so what is the game? $2/$5 blinds with $5-$500 spread limit?
I think Washington state is a bit of an anomaly as well. You used to have a smaller max bet law too, right? Was it $100 max bet? From my understanding lots of small almost bars used to offer small limit games and that was pretty popular. Spread Limit with a max bet of $500 will slow the cancer down a bit as it weakens the power of total unlimited max bet. I will concede that 2/5 blinds with a max bet of $500 would often play very similarly to a 2/5nl, but I do think that in the end the game and the rooms will be in trouble with that structure too.
In general, Poker in the US is unhealthy right now. There are multiple reasons for this and nl is just one of those reasons, but it is without a doubt a major contributor.. The status of online poker in the USA is certainly another big contributor.
It's not that I don't like nl, I think a lot of times people think that because I say nl isn't good for the health of a card room I don't like nl. Nothing could be further from the truth, I would love to constantly play in a huge nl game with bad players that have unlimited deep pockets, but that just isn't realistic.
Poker Rooms and poker in general is supported by losing players. What you really want is for the losing players to lose the maximum amount they are willing to lose, but doing it slowly enough that they always think they have a chance and they never quit. The median US household income is 68k/yr. If the average guy loses more than probably 5% of their income that is most likely unsustainable. Assuming that is true, that means the average person could lose no more than $3500 ish/yr and not quit. That is only $300/month. If a beginner plays even 1/2nl and the max they can handle losing is $300/month they could easily lose $300 and probably would lose $300 in an hour or less. They are now done for a month. Next month they come back and do it again. How many months in a row are they going to do that before they decide Poker isn't any fun? That same $300 could easily sustain a weak limit player for maybe 10- 20 hours of play in a $2/$4 game.
Do you now understand why nl is bad for a card room?