While WoD is definitely the big dog in this subsection of the hobby, it doesn’t really have enough power to truly stifle creative competition. To the contrary, I’d assert that it’s enormous popularity has generated a significant amount of “Not-WoD” yearning for other designers to tap into.World of Darkness has a stranglehold on the market. The creativity of other potential settings has no room to shine. Without competition, the genre stagnates.
The only thing is, “Not-WoDism” is not unified in its desires, so it will be very difficult for something different to grow beyond niche status. Hell, there are people playing urban fantasy/horror in the various iterations of CoC, itself a venerable and popular system.
As I write this, I am reminded of how impressed I was playing Monster of the Week. It was only a brief intro style adventure run over a couple of sessions, but I remember it being fun. And my character was a diminutive but sassy young first responder- she had no special powers but for her extensive understanding of what was in her ambulance.
(Used the paddles to give a hungry critter a NASTY shock when it got too close.)
My (limited) understanding of that game leads me to believe it could handle a pretty broad swath of urban fantasy/horror. We were slated to run a different campaign with different PCs, but it fizzled for a variety of real-world reasons. I was to be playing a fallen angel living as a human...