The problem is that many of those same small Studs with cheap/poor quality sires are the ones who are greatly assisting in perpetuating that struggle by way of knocking out a lousy product that can't win without some form of protectionist umbrella. The now defunct NSW Sires Stakes is a classic example of what can happen to the breed when 3rd, 4th & 5th tier sires are artificially made financially viable propositions.
Cheap does not always = poor quality though. I can think of at least 4 sires, all excellent racehorses, 1 proven and 3 unproven, that you can get into for less than $4,000 so it's not all doom and gloom by any means.