I think you're be disingenuous to the development of Chilean Rugby there. They've always had the base to push to become Sth Americas 2nd best team. But never had the pieces in place to make that step. Now they have in the establishment of soon to be two HP centres with a base of 50 players. On that series. The Eagles massively underperformed.
Regarding MLR I thin you're missing the point of the league. Which isn't to feed the Eagles. If the Eagles benefit then great. But it's a primarily commercial venture designed to provide the best possible product. Which means that if they can find a foreign based player then they will. That said there's still 160 odd places for American players. And growing. Plus, every franchise has growing community and performance pathways in place. There's been mention by one owner of a U23s structure being implemented in the near future.
I'm from South America, I know everything about Chilenean rugby, believe me. And I gonna watch they play from the stands soon.
They have a based of 45 semi-professional players or you could call them professionals. Currently they are like Jaguares in Super Rugby. They are a team with the best 40 players of their country playing together since 4/5 years. It's like a national team playing 20/30 games per year. Meanwhile the average Tier 1 national team play 12 games per year at the best.
The difference is that Argentinian Rugby provides them a more competitive tournament. They improved a lot but they are not so good as you can imagine. Any national team that plays 30 games per year gonna improve a lot. They live together since a lot of time. Imagine ABs, WBs or Boks being one club doing the preseason and playing together all the year. Any team gonna improve in those conditions but that improvement have a ceiling.
Particurly I see their defence improved a lot, they are an organized and hard defence. You don't need to have the Carlos Spencer skills to be a good defender, you need time to develop and organize it and they had a lot of time working with Argentinian coaches. They also have copied the Uruguayan rugby model, even they hired Pablo Lemoine, the Uruguayan head coach who lead Uruguay to the 2015 World Cup.
Moreover, Argentinian Rugby Union provided to them their best coaches, nutritionists and S&C coaches, in fact, to all the South American Unions in order to grow the region. They have advanced 30 years in 5 thanks to the solidarity of Argentinian Rugby Union, who is the godfather of these nations
Most of the time they play agaisnt weaker teams. For example, Argentina has their best 200/250 players playing in Europe. Despite that they have some quality players playing in MLR and many plauing for other nations like Italy or Spain. Also they have 2 teams in Super Rugby Americas, meanwhile Chile only have one professional team. Their best 30 players are together. For that reason they are better than the 2 Argie franchises cause they are facing the Argentinian players from number 200 to 300 in their ranking, guys with few chances to become a Puma, meanwhile all the Chileneans are Condores, their national team.