The reason (I'm assuming) Rostar was given the herdship was the fact Centrepoint not only held Ithor, but he was also one of/the only prevalent Ithorians at the time.
Lilith, its hardly old fashioned if it makes sense. It's simple supply and demand. If I own the entire supply, I can demand whatever the hell I want, and people do so. The way to eliminating that is as you mentioned, handing it out to multiple groups. Given the type of ship we're dealing with, that's a fairly terrible idea. They're pretty much entirely used for RP and shouldn't as Weylin said be common.
Per community games, I'd be very hesitant to give out prizes as large as Herdships or Mods. Winning a uno tournament shouldn't result in a prize that could be the equivalant of billions of credits, which either of those rewards would amount to.
I wouldn't mind doing smaller rewards/prizes or some kind of community event, but they take a lot of planning, a lot of time to run, and a level of activity that I don't think is possible right this moment.