Think about it, it’s the same deal. You still have to put up money as a guarantee, so why not use that for betting instead? If the bet loses, it’s the same loss. But if it wins, you get to keep all the profit. Makes way more sense, right?

Yeah. It is the same deal if it's put that way, but I don't think it works like that. If the match is indeed a fixed one, you won't lose the bet thanks to which the escrow will end up sending you the stake + winnings.
If it ain't fixed, the escrow will still send you back your stake. This is probably what op is trying to sell and he clearly failed miserably.