Since interest seems to be wavering as indicated by the penalties, would it help to take a week off between Cycles, for example?
Instead of a week break perhaps a month or two break? Maybe run the Challenge for a month during each quarter rather than successively. IMO it would keep the novelty of it better than just constantly running it.
This might be naive but part of the challenge was to be inclusive and have as many people join the fun as possible. You really don't know what your FE limits are until you have 4 other folks counting on you. The more people that cycle through the better it is for everyone. If the grind becomes to much for you and you need a month or two off then just resign for a cycle and join a team the next cycle or start your own team. Unless of course you having trouble finding folks then that's another issue. It's suppose to test your limits and be fun.