Let's see...
It is sad they are cutting the scholarships but if the money is needed elsewhere, it is needed elsewhere. Some people will have to stop playing: their budget for Pokemon depended upon the chance they might "win" some of the money invested back through the tournaments. This is less a financial reason than an ethical one: if your budget is so tight you simply should not be attempting to play Pokemon competitively. You are free to, and to complain about these changes, but I am also free to claim it is foolish. There are other hobbies that are fun and can prove profitable, and more reliably than Pokemon and its scholarship money.
If you (your parents, etc.) can't justify investing enough to play in this game competitively without at least potential returns, so be it. It is unfortunate but the scholarships are failing to keep attendance steady, let alone raise it. I would point out there are many benefits from playing the Pokemon TCG besides winning scholarships. It is a great learning exercise and I personally have learned much from my involvement with this game... which began with its release when I was a Junior in High School! Younger players have even more they may learn or hone through involvement with the game.
Many are favoring entry fees to improve Prize support, but I must advise caution: you do not want to encourage "mercenary" players who are here just for the Prize support. I personally saw the problem this caused in Yu-Gi-Oh and while not admissible as fact here, have been given anecdotal evidence (largely through others' first-hand accounts) of what this does to Magic: The Gathering. Spirit of the Game dies in these venues, because you have created a great incentive to kill it!
I already know players who have had their decks stolen at tournaments. I sincerely doubt this is because of the inherent value of the cards, because even during the more expensive times of Pokemon, we aren't talking that much of a monetary gain. These thefts take place during the tournament, when someone having a deck stolen can lead to the victim being disqualified, unless they can quickly pull together replacements for the stolen cards!
If Pokemon becomes a game players play only for the Prizes, the secondary market will explode. If you can play this children's card game well (or coach your own children well enough) you can get a lot from playing it... especially if you aren't good enough to do it with other, similar venues. Again this is anecdotal (after all, I can't even remember these player's names) so I will just say I got the impression that the Yu-Gi-Oh players who just "played to win" couldn't cut it in the climate of Magic: The Gathering.
As for suggestions about selectively charging for entry fees... either charge a flat fee or do not. I know there is a desire to make it fair but guess what? TPCi has yet to get God to run OP. Mortal man has to invest far, far too much to make sure people don't play the system... and we already know that more players in the 14- divisions are having others pay their way than those in the older brackets. That is to say, if someone's parents has the money to keep them in Pokemon competitively, why is it any more "fair" to ask that person pay than a similarly blessed adult who pays his own way?
What about situations where the family who has a single child has plenty of money to play, but a family full of dedicated players has to sit things out because they literally have spent all they can on the game, and any more makes it financially infeasible. I've had to walk away from great deals because I was just a few bucks shy. It isn't a cost vs. benefit issue, its a threshold of "I can spend X and no more." Plus even assuming there is flexibility... longtime family of four where everyone plays comes up against a $20 entry fee and all players are in the Master's Division, that's an extra $80 for the event!
Asking for entry fees in general is risky: as stated there is evidence to the contrary that the money will not go into Prizes, and even those well meaning by suggesting improving other aspects of the tournament... what about those of us who can't enjoy it? I am morbidly obese with Irritable Bowel Syndrome that severely restricts my diet. My standard operating procedure for tournaments is to eat a light breakfast, drink plenty of water, maybe allow myself some foods that are incredibly easy to digest and providing just enough calories to avoid serious issues, and not eat for real until it is all said and done. Anything else, and if my condition flairs up I risk DQing myself from the event! I can't even drink coffee anymore: I so miss caffeine.*While a hat is nice, I have a big head (even ignoring my weight) so getting one that fits well can be tricky. Events with free shirts? I get them if it doesn't deprive anyone else, just to see if someone else I know wants it (like a friend or family member): it does me no direct good.
Here's a thought: if we want to make big events more rewarding for players without taxing the TPCi budget? How about exclusive merchandise to purchase at events? Works for many conventions. Top player's might get some freebies, everyone else can just pay-up. Didn't attend? Learn to live without it or pay for the secondary market. This helps encourage people to attend, and I know a lot of conventions where players get to enjoy themselves because the "swag" they get (including what they actually purchase) gets resold to cover a large chunk of the expense. While still hardly full proof, it seems a better deal than competing and hoping you're "the best" for a scholarship.
*Technically I get small doses of caffeine from certain foods, but nothing significant enough to make my earlier statement untrue if taken completely literally.
tl;dr: If this was about the bottom line, Nintendo could cut all OP, focus on the video games and cash in on the name alone to maintain profitability, just like so many other TCGs. No, not a summary but if someone didn't want to read all the above, this is the part that trumps it all anyway: OP is all optional for Pokemon! The amount of clients who buy into the game for "Organized Play" pales in comparison to "random little kids" driving sales!