You raise in interesting point in relation to where people generally say they are from 'when travelling'. I have mates from Oldham who say they are from Manchester whenever they are 'away' from home. Personally, it makes me puke.
However, I live in Camberwell (a district of Melbourne), but when anybody in the UK asks me where i live, i say Melbourne.....maybe beccause few people outside Australia would know where Camberwell is.......in many ways like few people outside England know where Oldham is.
Anyhow, to the point.....take a look at a map of Melbourne and look at the proximity of Melbourne, North Melbourne, Collingwood, Carlton, Richmond and Hawthorn. It's about half the size of Oldham and houses six AFL teams. Throw in St Kilda, Essendon, Footscray (Western Bulldogs) and Geelong....that's competition for support. Lowest average attendance amongst that lot for 2010? North Melbourne with......over 27,000.
If the product is good enough, people will turn out.