I would suggest keeping two things in mind:
1. Crews are awesome, crews are great, but they are also the least popular as far as attendance.
2. People want to play more. Making extra people move on (like saying top 2 move on from pools, period) and ending up with 40 people in the 2nd round isn't such a bad idea. It is worth staggering your rewards for a little extra bit of time.
1rst round all are out except for 32 (top 2 from each pool) and the top 8 that didn't play in the RR (40 left)
2nd round is 40, 5 pools of 8, top 2 move on (10 left)
Round Robin between the 10 players.
It isn't that many matches, it solves the problem of disheartening the players that are right on the brink. I've played my best and have made top 32 at every tournament I've gone to, save for FC6, including MLGs, and the only reason this is true is because it is top 2 advance. If it is top 1 advance, you've already (in the other players eyes, at least) determined who moves on. There are a LOT of players that have the potential to be that #2 moving on, but very few that are the #1 moving on.
If you are worried about time, then just take one extra TV away from Round Robin, or remove crews (as much as I like them, they are really more of a money pit at this point).
Also, if I may make another suggestion....
The big issue in most players' eyes is paying too much money for too little gain. I suggest maybe organizing a low-tier side tournament, or maybe an iron-man tournament (a one man crew battle, 3 characters per person), etc., etc., and just limit those tournaments to one or two TVs.
This way, the people that get knocked out early can go off with other people that have been knocked off early, pay $1-$5 to enter a double-elimination bracket limited to the top 32 entering, and can enjoy themselves. Having one or two of these little side tournaments would ultimately fix the problem of free play, as there would be two groups of 32 players (that is 64!) preoccupied with another tournament limited to two TVs each.
Having a TV left completely for money matches might be an interesting thing too. No one likes watching two guys play friendlies, but people crowd around money matches. Give people entertainment, and they won't be bored.
So...
Let's say we have a total of 18 TVs. Not a huge number, not a small number, and with 100+ people going, not an unthinkable number.
All TVs are designated for the initial round robins. No freeplay is allowed. (18 used)
Assuming you do the top 40, then top 10, as I said above, let's say you have
14 for Round 2, and 5 for Round 3 (final 10 man round robin, instead of 8).
so during round 2, if you are using 14 TVs as best as possible for the large RR, you have 4 TVs leftover. This is where two lower tournaments could start. A low-tier, an iron-man, another singles, whatever you decided, with 32 people in each. If people agreed to it, that would be 64 people playing in the side tournamnets, and 40 people playing in the round 2 RR, which mean 104 people are taken care of.
Any other TVs you may have would be open for free play, money matches, etc.
When Round 3 hits, you've got a large number of TVs open for freeplay, and non-stop exciting matches for people to watch.
Just my 2 cents. I think the solution is to give people either something to watch, or something to do, and if that means taking away crews and extending singles for an hour, why not?