This is exactly where I am coming from... Vince didn't HAVE the TV penetration, it's why he did stuff like buy the Georgia slot. He was playing catch-up and also trying to launch Wrestlemania and PPV as the chosen vehicle for his shows to thrive on. Wrestling had ALWAYS been on TV in some form so most people knew it in some form, many had a casual awareness of names in the business who didn't avidly watch but Vince was going all out to get Wrestling to mean WWF in the hearts and minds of everyone, from the die hard fan of the NWA to the most casual viewer who only bought Mania cos of Mr. T. Whether he allowed guys to work anywhere else wasn't the point, he had a juggernaut building and had to control talent to feed it... live gate was everything, it wasn't just a show, but A and B even C shows in different towns... he couldn't let talent "off" in the way his father had and expand as he wanted. As Jake famously said, they were obligated to wrestle or to be available to if required every calendar day...because Vince was running large numbers of shows, more than had ever been attempted...and on a national scale.
TV was just a vehicle then, PPV was a vehicle but the live gate was king and while Flair would have probably drawn big crowds, Vince already had Andre who was proven and loyal to lead those B shows...and then Savage and later Warrior.
Vince's national expansion (though it really means little to this debate) was handled very smartly. Absent the kind of reach TBS provided Crockett/NWA (which as you point out Vince did buy at one point, only to be forced to sell back due to the large number of protesting fans who wanted the NWA associated product back), he would buy slots on local TV for his syndicated shows to air in a market. Back then the promotions typically didn't but TV time for their syndicated shows outside their core areas. Vince's production techniques and presentation were way ahead of everyone else (he had worked in promotions for an arena in CT I think before he ran WWE, dealing with rock shows, etc). He showcased his flashier, more professional looking product in the local market for awhile before running shows there. When he did (finally) run a show it was a stacked card, as many top stars as he could muster, including Hogan, to give it a "Special Event" feel. Then he wouldn't run shows in that area for awhile, building interest in his return. Meanwhile he was on the hunt for any top talent that could help him, stealing Valentine, Piper, Jake, Steamboat from the Crockett/NWA, Henning & The Rockers from the AWA, Rude from the NWA (he had jumped to the NWA from World Class), Terry Taylor & Ultimate Warrior from UWF, Savage from the Mid South area (he wrestled in a variety of areas including his father's promotion), DiBiase from Mid South, Race from Mid South, etc, etc. By the time he signed Kerry Von Erich from World Class they were almost out of business (The Freebirds had jumped to the NWA at the same time). He bolstered his roster by picking off the best talent that helped draw for the competition while building his brand in their core areas through syndicated TV. Evventually the USA network deal helped him compete nationally in terms of weekly viewers with TBS, but by then he already gotten mainstream publicity for WWE through the use of non wrestling celebrities at WrestleMania.
Fact is, Jim Crockett operated much the same way. He pulled Jimmy Garvin & The Road Warriors out of the AWA, got The Rock & Roll Express out of Mid South, Sting from the UWF, Barry Whyndam from WWE, Rude from World Class (though he bolted a year later for WWE), Steve Williams from World Class, Kevin Sullivan from Florida, Mike Rotunda from FLA (after a WWE stint), Tully Blanchard from World Class, Lex Luger from FLA. Most of those made huge contributions to the NWA brand. Likewise he expanded his syndicated TV base into other promotions areas to complement the TBS coverage (I don't remember NWA programming on local TV in Pgh in 1984 or 85 but I definitely remember it by 1986).
Where he was different, or more aggressive, than Vince was in his travel schedule. Crockett wanted to turn other top cities in rival areas into monthly or bi monthly standards for his touring outfit. WWE still managed most of their house shows (the most important source of revenue back then with PPV in it's infancy) in his core area around NY, NJ, CT, Delaware, and parts of Canada near the border. His forays into rival territories were not done monthly. Crockett had success invading Pittsburgh, a WWE mainstay since it's inception due to it's closeness to NY & CT and the fact WWE Champ Bruno Sammartino was from here and did so well in Philly that McMahon had to promise he would do a set amount of events each year to exclusivity agreements with the biggest arena in town (relegating the NWA shows to the #2 arena). Vince followed suit locking up arenas in his core area (although he lost Nassau Coliseum and The Meadowlands for awhile). He did the same thing in CHI where both companies were very popular.
Crockett thus incurred major travel expenses with cross country travel that McMahon did not, simultaneously ignoring his base where he could sell out shows monthly through much of NC, SC, GA, FLA, KY, TENN, WVA, St Louis, etc. It was not a cost effective way to battle Vince who made only occasional forays traveling across the country into rival territories while relying on his slickly produced TV productions and mainstream media presence thanks to celebrity guest spots to raise his profile (while running most of his shows in his core areas of strength). This made his shows like "Special Events" when he did appear and guaranteed top attendance each time, where as Crockett's shows did not reach max attendance for each trip since they made them all the time. The success didn't match the cost.
Crockett's back breaking purchase of the bankrupt UWF didn't help (he was convinced he had to buy the company, locking up it's TV and talent to keep them away from Vince). However, not all the UWF talent was useable on an already stacked NWA roster talent wise, plus the UWF had considerable debts that the NWA now had to pay (you buy the company, you get all their holding but you also get all the debt). Plus, most of the UWF TV contracts for syndicated TV were in areas the NWA already had exposure (like here in PGH). Crockett spent a loot of money and gained little in terms of new TV deals in new areas or useable talent, plus was saddled with un paid bills . Compare that Vince 25 years later when WCW died, he didn't buy WCW, he left the talent, any property, etc all under Time Warner/AOL. He picked off the video library (so a competing wrestling company couldn't use the footage to establish a connection with audience or promote any of the talent) and bought the rights to the name (and some of their PPV names I believe). He offered structured buyouts to any talent he was interested in if they would break their Time Warner Contracts and re sign new deals with him (Time Warner agreed to let any talent out their deals with no penalties). He never bough one contract from any talent
(that's why guys like Flair, Hogan, Nash, Goldberg waited so long to jump ship, they had guaranteed money coming from Time Warner they didn't want to forfeit as they knew there would still be interest and value to them later on). Vince came in, bought what had value, left everything else behind and cherry picked talent he wanted. Given that business sense I doubt he would have been suckered into buying the failed UWF, no one back then understood the value of the video library as they do know thanks to home video/dvd, but Vince could have fought Crockett for little talent he though useable (
other than Sting, Warrior, & S. Williams how many UWF guys really made a major impact going forward ?) and since both had TV contracts in most of the UWF cities they could have negotiated with the local TV (if they wanted) to buy the now free time slots without inheriting a bloated roster and unwanted debt.
The NWA had some considerable success (far greater national presence than either ROH or TNA have today - by a wide margin), and in fact that audience was what put them back in the game in the mid 90s with the Hogan/Savage/Flair/Sting show and later on with the original NWO storyline. Don't underestimate their national role. Vince was much smarter business wise when it came to expansion however, there is no doubt.
In the end, the match didn't happen in 1985 simply because Vince couldn't let his talent work outside WWE once he started expansion and these prior matches always involved one of the champs appearing on their own time outside their normal schedule. By 1986 Crockett was doing the same thing. By 1986-87 both companies had a significant national presence and never would work together. Vince did try to get Flair to work for him a couple times in the 1980s but failed.