How do you think the rules of the tournament applies to people who are from neither Earth nor Outworld? Like Seidans, or Chaos realm inhabitants? Or, to use a non-MK species as an example, Predators (from the Predator movies, duh). Would they even be allowed to participate in the tournament? If so, would they have to pick a side?
Bo Rai Cho couldn't participate, because he was from Outworld, and him winning the tournament would have been a win for Shao Kahn. Raiden couldn't participate himself, being an Earthrealm god and thus at full power in our world. But Quan Chi and Scorpion could, even though the Netherrealm wouldn't gain anything (as said in Quan Chi's MK9 bio). They, along with humans like Kano, Sektor and Cyrax, were allowed to fight on Outworld's behalf.
Could it be because they weren't supposed to win the tournament themselves? Was Goro, an Outworlder, expected to remain the MK champion? What would happen if someone from neither Earth nor Outworld like Quan Chi or a Predator became the MK champion? Would it be considered a draw, and thus not a win for either Earth or Outworld?