We've had 550 unique players for Civ4 XOTMs in the past 12 months. I estimate, based on players with significant post counts, that there are up to 5,000 active forum users. If we plan to make substantial changes to the competition we ought to target to double our participation.
Small changes that tinker with the way we classify and reward players will not do that. Think big, guys!
I know I'm probably flogging a dead horse here, but dropping the requirement to fiddle around with the settings of Vista in order to be eligible, at least some months, would probably be a start -- Vista/Windows 7 users are likely to keep increasing as a proportion of players; Steam possibly also (as Civ4 disappears from the shops but remains well-advertised on Steam). Requiring players to chase through Windows settings that were not designed to be nice to fiddle with, following directions that are "somewhere in the forums", is not a great way to get those on the fringe to join the party.