Maybe I'm overvaluing the talent they will have access to, and obviously they'll have to fight ACC, SEC, and Big Ten teams for it. I think the proof is in the pudding with mid-Atlantic talent (if you include Virginia in the mid-Atlantic and no the "south", which may be a stretch depending on who you talk to). For years and years Virginia Tech scooped up underrated talent from Virginia, MD, DC and PA, and won 10 games easily in a competitive ACC. Then people started paying attention to these kids, and Virginia Tech had to start fighting national powers for them (and losing some battles), and Tech has gone downhill while the talent has gone elsewhere.
Looking at this year's mid-Atlantic talent, if you constructed a class strictly from NY, NJ, PA, MD, VA, and DC, per 247 Composite you would have the:
#2 (Peppers)
#4 (Hand)
#6 (Brown)
#8 (Blanding)
#24 (Tabor)
#25 (Prince)
#61 (Nelson)
#84 (Holmes)
#89 (Holley)
#103 (Nnandi)
#108 (Aniebonam)
#112 (Henry)
#124 (Blacknall)
#125 (Kamara)
#135 (Trumbetti)
#144 (Henderson)
#176 (Bookser)
#179 (Godwin)
#188 (Brown)
#197 (Moss)
#198 (Nicholson)
#206 (Gesicki)
#207 (Dickerson)
#212 (Cosentino)
#221 (Payne)
So that's an entire 25 man class of 5-star and 4-star players in the mid-Atlantic, and they wouldn't even need to go into Ohio or Michigan or the south. The only "local" teams they'd have to compete with for those guys are Rutgers, Maryland, Pitt, Virginia, and Virginia Tech. Not exactly going toe-to-toe with Saban or trying to grab a guy from Sumlin's/Strong's backyard. There is a #1 class worth of talent in their backyard and the local teams they have to compete with for it are all varying degrees of "meh."
You might be right that they'll have trouble truly capitalizing on the talent that is there and they might not be able to get over the hump, but I think once sanctions are up that they'll be very competitive in a relatively weak Big Ten. I guess we'll have to wait and see what Franklin can do.