No they weren't, that was just a lot of bluster at the time from Mick Tait.
I'm not sure there's enough dependable local support to support a full-time side (as would be needed in the Conference)- plenty who come out for big cup games, but you need folk through the gate every week. That might change over time, but it will take a while.
Harry Dunn was doing a canny job (got Spartans to 7th in the Conf North) until the board binned him. Tait came in and then Steve Cuggy, who saw Blyth relegated.