Chuck,
I see your point and to break down the walls between the different organizations would be great, As president of a club I can say that our financial situation would not allow for $2000. Not to say that is not a good incentive to generate interest.
If that amount was lowered maybe it would work, I know the overall pot would not be as high, but a trial run for this type of event would be a good start.
Lets play with some numbers!
Let say $200/team plus $100/club to enter teams.

10 different clubs enter generates $1000

Lets say each club submits what they can for teams, C1-3, C2-4, C3-1, C4-2, C5-2, C6-5, C7-3, C8-2, C9-4, C-10-4. A total of 30 teams @ $200/team = $6000

So we have collected $7000 in total for the event now for your payout
1st $3500
2nd $1750
3rd $850
4th $500
5th $300
Total $ 6900, $100 left over for trophies

This is only based on 30 teams hopefully the interest would generate more.
$3500 is not a lot of money to win but it's about bragging rights anyway isn't it?