I think not. While it's tremendously physical, after a while, the emphasis becomes more orientated toward skill, tactics and determination than sheer physical physicality. By his reasoning, anything mentally taxing could be called a sport. Therefore, studying hard for days or weeks for an exam or term paper could also be a sport, and so on. Chess is a great and worthwhile endeavor, but it's not a sport.
Cycling IS one of the most intense, exciting sports of all time.
I think most people accept the fact that they will make no money, but they want to compete for a large purse. If they don't make it into that final group that will get the money, then they have lost nothing. Most racers have an unrealistic view of themselves as people who are actually capable of being in the money at races, which is quite the opposite from the way it actually is. What is funny is that almost every bike racer I know is shocked when they do finish in the money, but if you ask them before the race, they think they have a real shot at it. My view is that most race promoters do it right with a mix of services vs. prize money.