But the act of being on Star Search is not just singing (or dancing, or telling jokes, or whatever), it is the act of being judged arbitrarily against someone else to see who they thought was better at the activity. THAT is the part that I question whether your wife (or anyone else) would be willing to take part in with nothing to be gained.
Sorry, but my wife has done this. Many times, in fact. She has often gone to auditions at volunteer singing groups - no money, publicity, street buzz, etc., involved at all - where she was judged (let's hope not completely arbitrarily, but there have been cases...) against other people trying to get into the group.
She purely LOVED the competition. It stimulated her, got her interested in perfecting her craft, motivated her practicing, etc.
And she didn't get a dime for it. She got no publicity for it. She got NOTHING for it (I should know, I keep track of our bank account) except personal satisfaction. These were (and are) unpaid groups who sing in pretty thorough anonymity. It really is very similar to your empty-warehouse thought example.
And, of course, all the other people who auditioned for the groups similarly got nothing for their pains except personal satisfaction. There are literally tens of thousands of people across the country who have auditioned for such volunteer classical singing groups.
Now I'm sure that passing an audition is more fun than failing, and happily my wife has rarely failed at anything involving vocal ability. But many, many people have done exactly what you suggest nobody would be willing to do.
I'm also sure that many contestants on Star Search are somewhat similar to these folks. They're in it - at least to some extent - for the fun of the competition and to show off their skills. Just as I'm sure that some contestants on Jeopardy are in it to show off their knowledge and to enjoy the game.
Yes, there's an obvious monetary motivation in both cases as well. For some contestants on both shows, it may be the primary motivation. As I said before, I'd guess that almost all contestants on both shows have a mix of motives.
So, indeed, this looks more like a similarity between the two types of shows rather than a difference.
But I noticed you slipped in a bit about the judging on talent contests. And I agree with Chris C. that the real difference lies here.