The attendance has gone up every year. The team with the best attendance in the league, the LA Galaxy, gets 22000 fans a game. Freddy Adu has really helped attendance, DC United is by far the leader in road attendance because of Adu even though he only plays around 10 minutes a game.
As for the league itself, it is headed in the right direction. They got rid of overtime and the quality of play improves every year. There are quite a few things that are holding the league back however. One major problem is soccer fans in the USA. Many of them don't like or watch the league because they think the quality is bad and think watching MLS is below them. The league will never improve if people refuse to watch. 79000 people can go to a Manchester United game at Giants Stadium, but you will never see 25000 go to a MetroStars game. Another major problem with the league is player contracts and salaries. The league has a strict salary cap and maximum salary (they ignored the maximum salary when signing Adu though). In the NFL and NBA, having a salary cap is good. However, it is bad in soccer because it prevents the MLS from competing with other leagues for players. Another problem is that the league controls player contracts. The league should let individual teams control who they sign and who they sell. Also, another thing that would make the league better would be reducing the playoffs to two teams per conference. Right now four teams in each conference make it and having 80% of the league in the playoffs is stupid. The MLS has made steps in the right direction, but I think the league could benefit by letting individual teams control player contracts and by getting rid of the salary cap and maximum salary. If they got rid of the maximum salary and salary cap, the talent level of the league would grow more.