My son's school has some MLSN players who just didn't play HS soccer. I assume that's the case for most players in that situation.
On a related note, I don't see why teams below Varsity (and especially Frosh teams) don't just forfeit all their games up-front, play the games anyway, and let their kids practice/play externally also. The season results don't matter for anything (no playoffs, and Frosh game results aren't even tracked anywhere in my son's school case); there's no good reason to prevent those kids from playing externally during the HS season, if the official results of the games don't matter for anything. It's only Varsity where the results matter at all, for playoffs and school rankings, and such.