1. I don't know. Players don't really have all that much choice as to where they go. Re-signing free agents isn't really about cachet anyway; the current team can offer more money, which is why most big names don't hit free agency. The Knicks can afford to pay luxury tax because of their market, but I see no evidence that the name means anything.
When you say that it's NYC doing the selling, that's of course different than the Knicks doing the selling and the Knicks, not NYC, are the better comparison for the Tar Heels.
2. I don't spend much time thinking or talking about all the factors that drive the BB program's success or lack thereof. My point has mostly been that it's really hard to evaluate performance when everything is in such dramatic flux.
Changes to the system have definitely decreased my interest in the end product, which is what I think most of my bellyaching is about.
I do think that UNC has struggled mightily with our recruiting from small schools. Tenn got Knecht and we ended up with Cade Tyson (a year later but still). UConn's starting backcourt on its NC teams were transfers from schools like Coastal Carolina or LIU; we got Keeling and Justin Pierce. We did well in the P5 transfer market (Manek, Ingram, Cormac) but we haven't been finding the gems like other programs have.
I don't know if that's a small sample size issue or a program weakness. Either way, it has been a relative failure, and the increased importance of that type of recruiting has contributed to relatively poor results.