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A) But they would sell far far fewer tickets and less memorabilia. I've been to really nice castles that are nowhere near as many visitors and have tiny gift areas. The most famous castle in Germany (Neushwanstein), also one of the most famous in the world, only makes about $6M/year while Windsor makes $45M/year on its own. A castle I went to just outside London was really beautiful and cool, and I could freely walk around it with almost no tourists and an entrance fee about half what Windsor was... because it wasn't connected to anyone famous. It was just a castle. I went to the main palace in Vienna, and it was basically empty.
B) Fame isn't a zero sum game, and some things aren't so easily replaced. It's like saying if Jordan hadn't been in the NBA there would have been another player of his caliber. Or if Michael Jackson hadn't been around in the 80s there would have been another King of Pop as big as him. To be clear: I'm not saying the people in the royal family are special like Michael or Michael, but the royal family as an entity is something the world doesn't have any more. How many people know the royal family of Spain or Denmark or Saudi Arabia outside of the people in those countries? Now how many people know the name Queen Elizabeth? Not only that, but the people who buy tabloids fucking love reading about royalty. Yeah, there will always be famous people, but the things they are famous for aren't easily replaced.
I'm no fan of the royal family. I think they are fucking disgusting and shouldn't exist as an entity. But there isn't another entity out there like them, so the UK has made the financial decision to give them a stipend in exchange for the income they provide.