DC leagues and players are doing just fine. The DC team at sectionals at 3.5 had a very even mix. You just aren't going to have a team made up of just DC residents in this area...the districts are just too close together. I think the influx of VA and MD players makes DC league more competitive.
I know, too, for me, it is actually closer to play DC than MD or VA, and I LIVE in VA.
I know the captains of which you speak, of course. They are beatable, but most don't even try.
What would you do if you knew you could not fail?