Worst case scenario is that everyone's going to boycott Sword & Shield to play competitively on Pokémon Showdown since it will supposedly have all 800+ Pokémon from the National PokéDex including all the new Galar region Pokémon which is supposed to include Mega Evolution, Z-Moves, and Dynamax. In other words you'll have two separate meta's one that includes the National PokéDex and the other that doesn't which has been cherry picked by Nintendo / Game Freak themselves. To be fair the official retail games have been losing money since Gen 5 when Online Battle Simulators for Pokémon were first introduced. Why pay a $60 price tag for a game that you can literally play for free online that has the same graphic capabilities as the Nintendo Switch?
Except the ratio of people who buy a new Pokemon game just to play it vs. the ratio of people who only play Pokemon for the meta and to battle competitively is very, very small. No one (no large amount of people enough for Nintendo/GF to pay attention to, anyway) is going to boycott the new games just because the competitive pool will be smaller.
Yes, the competitive play scene is big, but it's not everything and it's nothing compared to the number of people that don't do competitive play and just want to play a Pokemon game for the experience. If Pokemon suddenly lost all its competitive VG players, it would hurt yeah but it's not like it's what makes up the entire franchise.
If people only played Pokemon for competitive then yes, the battle simulators would be the only thing people ever used.
Also, GF has made other titles in the past aside from Pokemon, it's nothing new. It doesn't mean that they're tired of Pokemon (although, let's be honest, at least some probably are), I'm glad that they want to expand their range more and more.
I agree with you on that first part though, I wish they wouldn't keep replacing the gimmicks with ones that don't work as well. When they strike a goldmine, they should hold onto it for future generations, not pretend they don't exist anymore or quietly shove them on the backburner.
I recall in reading a past interview how one of the creators discussed this regarding X and Y, and how bringing new gimmicks (in this case, customization) to the games is what separates them from other generations, and without the new/replaced additions, what else could they bring to the table to spice up the newer games and make them different enough so that its not just a copypaste? (jokes on them, it kinda is no matter how you look at it).
I want to say they were initially considering customization only being a Kalos thing, but because there was so much feedback from players on keeping it, they changed their mind, but don't quote me on that.