You're right in what you say about RFU revenues, but I have no idea as how much if any of it has been spent on developing the game in the north.
What grass roots success are you referring to? The biggest example I can think of is the perpetual strength of Yorkshire's colts team. Since league rugby was introduced, northern rugby appears to be in decline to me with clubs like Broughton Park, Manchester, Preston Grasshoppers, Orrell, Aspatria, Vale of Lune, Morley and Waterloo dropping out of the National Leagues, Headingley and Roundhay amalgamating and Wakefield ceasing to exist. I know that some have gone in the other direction (notably Rotherham and Doncaster), but on balance, I'd have thought that the northern presence in the national leagues has become weaker, as evidenced by the seemingly ever increasing London bias in National 1.