To address Deuce's specific question about money.... "How can a FREE bar league award CASH prizes NIGHTLY?"
The question has two components
a) How can they afford to give away money, and
b) How is it legal to give away money.
The bar league collects money based on attendance fees from the bars and sponsorships. This is the money they use to pay salaries and prizes.
Why is it legal to give away money?
The standard test for legality is to look for three elements, Consideration, Chance, and Reward. All three must be present to constitute gambling. Valuable Consideration is your buy-in or entry fee. Chance is generally considered to be present in poker. Reward is the money that is given away nightly.
So it is legal to have Reward if Consideration is not present.
I suspect the PPA uses the skill vs. chance argument as a wedge to break the concept of illegal gambling where the courts will allow it. It does not apply in mos cases, but occasionally it works.
Anything will work as long as you can remove one of the three legs of gambling. For instance you can collect a $100 fee to play from each person as long as you do not give away prizes of any sort.