Well, there isn't just one single fighting community. Never has been. It's always been groups of varying sizes, each on their individual sites, often unaware of one another.
The community I played in - and still hang around - is still fairly populous. It's de-centralized though, we only come out of the woodworks for tournaments. Our community ran an annual team tournament with sixty-four participants, and we'd often get as many as 100 or more people trying to enter with their friends. The group was never static; people came and went, but we always had at least thirty-two people for our 1v1 tournaments and usually sixty-four. You could probably tap somewhere between 150-200 fighters if you really went searching for them.
On the other hand, other communities are remnants of chat-rooms and only have ten or fifteen people. A lot of these communities do dwindle over time, simply because they don't draw in new faces. That happened somewhat with my home community. We had the old guard from 2006-2008, then the new guard (including myself) stepped in at 2008 and began running tournaments. Around 2011/2012 we became too busy with RL and there wasn't a "third wave" to replace us.
I think the reason RPGuild's arena community is so small is that it doesn't have much traction with the rest of the site. I mean, there's 60,000+ users - if even half of those are active accounts, you'd think there'd be more fighters.