But physical sportsbooks still do exist, only that the small ones will not survive.
The physical casinos now that include sportsbooks are not just marketed as casinos, they also have hotels, restaurants, and other attractions, so they are not only marketing people to gamble, they are marketing people to enjoy. And when you go to that kind of place, you are expected to spend money, not win money.
In short, they exist but the demand is not the same as before.
It makes sense what you said, of course for people who run a business there are difficult situations such as shops that become quiet, but on the other hand there are also people who do not give up easily so they look for ways to keep visitors or attract new visitors in ways that they do such as one of them with what you said.
Apart from that, the question for me personally is, do these online casinos that operate have physical casinos? I don't think so, but with them originally running a physical casino and seeing the current situation they should be able to compensate by creating an online version of the casino.