My DD is new to tourney play this year having joined a team mid-season, so I can't comment on what TDs do or don't do. While 8 teams does seem like a better number, with at least 4 it works well for 3 pool games and elimination round games.
But I think the bigger problem is probably the promotion of the travel teams themselves. There is a travel team near us (in central OH) that isn't fielding a team in my DD's age group this year because there weren't enough kids trying out last August. My DD has played the past 6+ years in the local rec league that this team should draw from and I don't think I even knew about the team before, let alone that they had tryouts last August. In fairness we weren't really looking for a travel team last summer. But it seems like I heard a lot more about select and travel teams the first couple years my DD played than I have the last few years.
I know we weren't ready to consider a travel team until our DD proved that she was serious about the sport and maybe other folks are like that as well. Our perception is that it would be a big time and money commitment (which is true). But what is being undersold by at least some of the travel teams is the access to better coaching and a better quality of game that is being played.