In our part of the country Legion baseball is still very strong. There are several Travel/Tournament teams that do draw players, but often they play Legion as well. The points made by PGStaff about NJ Legion baseball being strong and understanding where you are as a player is really important.
Legion baseball was great for our son, he played on some very strong teams. Many years 75%+ of the players (usually virtually the same roster for hs and legion) go on to play college baseball, with numerous D1 recruits. For that reason college and professional scouts do come out to watch the high school and legion players. Most of the college level interest is relatively local. You won't see East/West coast schools traveling to the midwest to watch Legion baseball. They will however go to travel tournaments, Headfirst, Perfect Game, etc and that's a huge advantage for a player. Just like most of us they have a budget and they can best leverage their investment by seeing lots of talented players in one location.
From reading other posts on this board I know that many view Legion as 2nd tier. We've not seen that to be the case, but totally understand that each state seems to be different. While not being personally involved in running Legion baseball I do hope they figure out a way to turn the tide.