I kind of don't understand what you're getting at here. They're a nonprofit. The majority of their work is coming from volunteers. They aren't paying New York salaries.
This is like going to Linus and saying "You can't possibly expect Linux to be sustainable - do you have any idea how much money Microsoft pays its developers?"
Nonprofit/open models aren't less work than commercial ventures; the difference is that people and companies donate their time/money because they want the project to succeed. If they end up with a competitive enough product, then businesses will start sponsoring more development, because it'll be a cheap alternative to dealing with Comcast.
At that point, large businesses operating in the city will pay/sponsor New York salaries to maintain the parts of the project they find useful. Exactly like every other Open Source or community run project on the planet.
I have plenty of doubts about volunteer mesh networks, but I'm not so skeptical to say they literally can't work. I think you're looking at one particular model of the market and assuming that anything deviating from that model is broken, rather than just targeting different segments or trying a different strategy or even just accomplishing different goals.