I think you can't have both.
I'd disagree. I think you can, it is just really freakin hard. Pro sports leagues, for example, have done it. The NBA, NFL, and MLB all have their own premium channels and spin off both their sports and their sports personalities into a whole slew of entertainment venues that people gobble up. On the flip side, certain TV shows, games, or entertainment series have also come close to doing it. Taking what was once a specialized brand, show, or thing, and transforming it into something huge -- a whole universe of options related to that original idea. WWE is basically trying to do something that combines these approaches -- branching out into to obvious and not-so-obvious outlets, and using the stories and personalities they've crafted to do so. The problem is they are really one of the first to try this, to jump right into the whole damn thing without already being a juggernaut. So we see some bizarre decisions, poor management, and pretty ugly financials. But there are also successes -- look at Total Divas (as much as a lot of people here hate it).
I also think the idea that WWE could just hire top cable writers and producers only if they had decent media is a big oversimplification. They are bleeding money and simply could not afford to do that. Why do people think they are getting people like Jerry Springer and Seth Green? Obviously in the comments here they think it is because WWE is managed by old hobos who don't realize it is 2015. That might be part of it. I'd argue that a bigger part is they simply don't have the money for anything better. This to me seems completely obvious. Just read a couple articles on their financials or look at the papers themselves. They couldn't hire top writers and make some critically acclaimed shows if they tried -- because they simply could not afford it right now, especially after pouring in huge amounts of cash to propping up the network.
It is ugly, but in some ways it is all pretty innovative. Either way it is an experiment. Who knows what will happen. (Well, a lot of investors think they know -- WWE will be bought or bankrupt within the decade).