game shape is the biggest killer. I would do a forum search on game shape and just invest a bit of time in understanding its importance.
Basically, a $30k salary player with inept game shape will perform worse than a $10k salary player who has Proficient game shape. (or thereabouts).
and because gameshape is managed by the number of minutes a player plays each week, having players clock 96+ minutes each week would make their game shape head downhill fast. and hence you would get less performance out of them.
So thats the reason why people dont do it.
Why is the game setup such that you dont forfeit even with 3 players? Not sure. when i used to play amatuer basketball, at game start time, you had to have a minimum of 4. so maybe in some places its 3? Maybe the other reason as well, is because maybe in the past, lots of people were forgetting to set their roster, and so were being punished for this, so maybe there is some leniency with the number? who knows.