If the typical team had a $2-5 million for coaching, but with hiring like I mentioned above (everyone starts out asking for the minimum, market decides contracts and you assign coaches to whatever level you see fit), there would still be plenty of incentive to get good coaches, you'd still have the skill of finding good coaches, you just wouldn't have to spend an insane amount of money on it. And you wouldn't lose out on a HiA pitching coach because someone decides he's good enough for AA and offers him 10% of what you do.
If the average team spent $3.5 million on coaches, they'd still have an average coach salary (across all levels) of a little over $200K, there'd still be bidding, etc.. I'd just be on a much smaller and realistic scale.
Same for training and medical. Give every team a 2-5 million swing, and make the differences smaller, like they are in real life.
Teams can use the extra money to make player salaries a little more realistic. Heck, even the scouting budgets are insane. Find me a team that spends $20 million on scouting, that's comical. They pay their scouts like $50K each and a company car, and even the scouting directors don't make more than a couple of hundred K, and even that might be high.
I just have no idea where they pulled these numbers from when they set the game up.