Oh give me a fucking break. It's not Russo that wanted to bring in a watered down WWF to WCW...it was WCW executives who hired Russo to put on the type of product he was putting on. How much sense would it make to bring in Russo and tell him, "you know what, why don't you put on a Bill Watts type of wrestling show." That's just not the type of product he knew how to do. And WCW executives should have realized it. It's like hiring Big Show and telling him to go out and put on a Chris Benoit-style match.
And as far as a Bill Watt's type show...they had something pretty much close to that from August-October 99' when Sullivan was booking, right before Russo came in. The cruserweights were putting on great matches, Benoit/Malenko/Saturn were tearing it up and DDP/Raven were putting on great matches. And guess what...it wasn't exactly setting the world on fire, was it?
Sports entertainment style of TV being a clever way to disguise an untalented roster? Say what you want about it but if it wasn't for that style of show, the WWE would not exist today.
They had a pretty talented roster in 1996 and most were putting on good matches. Bret, Owen, Shawn, Austin, Taker, Sid (who was decent at the time), Vader, and Rock were all in the company. But at the time the company was in the toilet. Why? Because despite all of those guys being good workers, no one gave a crap about them because the storylines weren't designed in a way to make you want to emotionally invest in them.
I'd check out the match listings for Road Wild and Fall Brawl 1999. IIRC, they were probably two of the worst PPVs of all time. In fact, I would argue the WCW product improved slightly when Russo came in October. But by that point, WWF had basically converted anyone who was willing to watch their product. Russo's involvement in 1999 can be defended, but his return in 2000 can't be. By that point, WCW should have known it needed to provide an alternative.