Boeing can only offer 1 jet, they have to choose which. It's likely that UAC will also be in the same situation, with the merger of Sukhoi and Mig.
One can argue that LM offering the F-35 in lieu of the F-16 would be the same as the Russians offering the Su-57 instead of the Su-35, unless there are restrictions from the IAF's side to participate only with 4th gen jets, which is probably what has happened.
Plus the US doesn't want to provide ToT for the F-35 to India, they have already made that clear. They want a flyaway deal, regardless of numbers.
And it appears MRFA will be the IAF's very last fighter import deal, as per the IAF itself. So let's hope it's true, because it means the Indian industry can finally deliver what's needed. I am holding hope for a 2 squadron NGF tender though, run along the lines of MRCBF, but I feel it's just wishful thinking.