Think its a cool idea. Would be interesting if someone had some idea of what the top coaches are. No idea how to go about comparing results at D3, D2, D1 and worlds. I think you'd need to have at least one NT championship or some combination of say 30+ NT wins and 400 overall wins in that world or something. Maybe higher. Should be pretty selective, at least at first.
Think it should be full price and full rewards. It doesn't work unless the coaches are motivated (and WIS makes money). Having played "free" fantasy leagues before, too many coaches lose interest. Put some money into it, and the interest is higher. Also, by having to pay normal, you get people who are truly interested rather than just getting a free or discounted test team. My 2c