What are the odds that I'm going to get a payout? That someone out there is interested and willing to pay for one of the license plates I've seen? Probably very low. Do I really want to waste my smartphone battery doing this? I'd rather have maps and music on.
* A "point" system - spend "points" (or credits) to find a user by license plate. * You can buy credits with money directly, or you can earn them by contributing information
That way, if you're a data contributor, you have access to the information without having to pay. That's how data.com works.
The expected value of slot machines is negative too. Humans have a psychological weakness for "Just one more, I haven't won in a while, I'm due." In this case though it wouldn't even cost money to play.
The value prop for the average user is also very weak for encrypting data. I am more likely to lose all my data than prevent some theoretical malfeasance, never mind the extra time and effort. I am not a secret agent.