Papering houses has a long history of not working if that is what they did. It devalues your product, sends a message that you can always find a way to get a ticket without paying etc.
There are actually academic papers about the true cost of "giveaways" in terms of ticketing. Its just not very targeted as part of your marketing strategy. The GM's love it (full house), the true marketer and CFO hates it (revenue per seat collapses).
I have been hearing people say for years about Basketball in Australia "If we can just get people in the door then they will become hooked and buy a membership or come again" - hasn't worked to date so why would it work now?
Look at BBL. They are not papering the house. They have built a strategy around young families; made it incredibly affordable for the third and fourth ticket consistently. They are playing a long game with T20 to ensure long term participation and attendance at all forms of the game (so attendance at BBL is not the only outcome they are looking at). I was very skeptical three years ago about BBL, thought it was a blow away fad... but hats off to them, its been brilliant. And, participation growth is a welcome side effect.
But, overall, if you are giving tickets away in large numbers then your other fundamentals are wrong, because you are not generating enough demand. I might sample out a new toothpaste, but that is in an enormously cluttered toothpaste market and people HAVE to buy toothpaste. Free tickets are not sampling in this context. I don't HAVE to come to a basketball game. So, the demand needs to be based around the imperative of always being at the game.
I have no idea what Melbourne did, and a big crowd is great for the league. I am not accusing them or criticising them. If they sold 10000 seats then they deserve huge accolades.
As for interest in NBL sure, but there is no lack of interest in basketball in Melbourne.