I know this is a highly debatable point, so let me try to explain why this happened and why we are fixing it the way we are.
The current design is that everyone starts with 20 players. Those starting players are supposed to be at a certain skill level and its set up to allow you to work with those 20 during the first season and concentrate on small improvements over the first couple seasons versus having to stock up on players when you are first thrown into a league. The initial league cash and player salaries are balanced to allow you to sign 1-2 players to help you from the start and learn the scouting and negotiation features. I've checked the teams with 20 players in production and everything looks good for this.
Originally in beta, we started with 23 players and the player skill levels were a little more varied. When we place teams in leagues, we recalculate ratings and salaries based on the latest formulas to make sure everyone is on an even playing field. The clubs I had checked for this looked like all the salaries would be okay with the $850K model. There were obviously some clubs whose players were a little higher rated and whose payrolls did not fit under the $850K.
We decided to allow people to keep their beta teams as their FC Dynasty clubs, and in hindsight that might not have been the best decision. Although that would have been an unpopular move as well.
If you are with negative cash, you will not be able to perform scouting or signing players during that first transfer window. You can, however, try to get people to make bids for your players for transfers, which will be a way to get yourself into positive cashflow. We will be adding more features in the future for transfers to allow a little better mechanism to shop out your players, but right now it is pretty crude and you have to rely on people scouting your players and making bids. After the transfer window, we will correct any clubs that are negative and drop players from their clubs as I have described above. As you continue on, you will get cash from game revenue which will allow you to scout during the season, upgrade your stadium, and sign more players.
The only things you suffer are not being able to sign players during the transfer window and potentially losing a couple players, but even with losing a couple players, you are generally going to have a better team than the guy that has money to sign players. All of your club payrolls' are going to be under $850K.