I agree with you that 5k doesn’t go very far when it comes to purchasing things from GDKPs (though you can gear a toon prebis + AQ20 / ZG / lower end MC / BWL gear for 5-10k gold), it will only purchase a single item in higher tier raids.
For example, in the naxx GDKP I’ve been attending weekly for the past months, items start at 10k min bid and the total payout is usually 20-35k (depending on whether I get top healing bonus 
) Yet, the payout of an AQ20 or something can be just a few hundred gold. The cost of items in GDKPs is tied to the demand and difficulty of content, easy things have really cheap items and hard raids like naxx (which you need 38+ people with experience in the content, really good gear, lots of consumes, world buffs, and wipes can ruin the lockout for everyone) have really expensive items because there are only a few runs each week that can clear the content.
The guild I am in on Era runs naxx as SR + a ‘points’ system which many people enjoy and they had 2 naxx teams prior to SoD now there is only one per week - so there are many ways to gear a toon without ever attending GDKPs.
However, consumes are expensive (and were expensive even pre-tbc early phases) when I was on a server without GDKPs. I had to farm multiple hours a week to be able to attend raids properly consumed and eventually stopped raiding and quit for a while because I couldn’t spend the time farming.
When I returned to the game around covid time, there were GDKPs and I was able to fund my raiding and pvp activities from the gold earned in those runs. Even though I did GDKPs, even back then, I still did naxx with a LC guild to gear my main. So weekly I could mix MC / BWL gdkp for gold and naxx LC for gear.
These days, without GDKPs I would never take my main to a raid, it is far too expensive on consumes (even if they were 1/2, 1/3, or less the price) to buy flask x 2, mana pot x 5-10, dark runes, shadow pot x 5, frost pot x 5, weapon oil, and more to just take my healer into a raid which I need zero items. (running a melle dps or tank cost far more)
However, with GDKPs I can (and many others do as well) enjoy running with our best geared toons while we get a payout that allows us to buy consumes for pvp, gear alts, and generally never have to worry about gold in the game. But to get a toon geared to the point in which they can earn big payout in GDKPs takes a long time - I played that main since covid and it is nice that fully geared toons have that sort of ‘value add’ to an Era account.
Without GDKPs they would just sit around SW looking pretty and unable to pvp / pve unless they want to farm - or buy gold.
Pre GDKPs many people bough gold to play the game. Era is a game of consumes and to play at the top level it is expensive, many players don’t want to half play, we want to push our toons to the limit. And before GDKPs people had no choice but to buy gold or spend near 100% of their freetime farming. GDKPs may incentivize whales to buy gold (but as I stated - I think they and the sellers should be perma banned), but they also allow many other players to enjoy the game without buying gold. Even if RMT was fully banned, GDKPs would be the best source of gold - because they are where players can get the best items in the game.
It makes a lot more sense that the most geared players can earn the most gold by helping carry raids. (versus the no GDKP world in which a full t3 healer can earn the same amount of gold as a fresh level 60 farming consumes out in the world - and prob less than a fresh lvl 60 dps class).