It's not that no one was watching the ring, it was that Yang saw something completely different than what everyone else saw.
Emerald I'm assuming has some kind of ability to make illusions evidenced in her fight with Coco she must have used this ability on Yang to make it appear as though Mercury was attacking her, when in reality he was not. Everyone in the stadium and those watching at home basically just saw Yang break the leg of a beaten opponent, while Yang thought she was just defending herself albeit in a dumb and reckless way .

I was thinking about it shortly after i posted it. I eventually figured out the same thing, except i thought it was Neo doing the illusion, not Emerald.

Also thought that Yang was seeing reality, and the illusion was around the ring.

You're right, the more I think about it, Neo is the obvious culprit for the illusions, I just thought Emerald because Coco was tricked using an illusion in her fight with Emerald, although that was most like Neo as well because, why the hell would bad guys follow rules.

And I also initially thought that, but when I thought about it more, Neo would have had to use an illusion that tricked thousands of people in the stadium, a little too powerful, but could be plausible. Then I thought about something, the screens, now the way I figure, Neos illusions are supposed to trick the targets mind into perceiving what she wants them to perceive, but I don't think mind powers work well over digital screens unless you're hypnotoad . This would mean, in order to fool everyone BUT Yang, Neo would have had to trick the minds of all the people in the stadium, and everyone watching on those mobile device things and other electronics, which makes the span of Neos abilities sound ridiculously OP, or the other option, just trick Yang into thinking she's being attacked, and let everyone else see that she just shot Mercury in the leg.

I didn't know she tricked peoples minds. I thought she created actual visual illusions