Brown and Barclay have won 107 caps between them but have been omitted from Vern Cotter's 32-man pool.
"We seem to be promoting players who've come in from New Zealand at the expense of John Barclay and Kelly Brown.
"Your chances of playing for Scotland are greatly heightened by playing for Edinburgh and Glasgow," said Nicol.
Edinburgh flanker Hugh Blake has been called into the squad for the first time, in preference to both Brown and Barclay.
Blake qualifies to play for the national team through his Scottish grandparents.
Brown, 32, led Scotland into last year's Six Nations as captain, only to be dropped from the squad for the home defeat to England then recalled as captain for the loss to France at Murrayfield.
He was overlooked for selection for the three Autumn tests against Argentina, New Zealand and Tonga.
Barclay has excelled in the back-row for Welsh side Scarlets this season and, at 28, is likely to have several seasons left at the top level.
Former Bath and Glasgow scrum-half Nicol says favouring players who play their rugby in Scotland isn't necessarily wrong, but that ultimately the decision should come down to ability.
"There's not been a stated policy about not picking players playing in Scotland," Nicol continued.
"There are a number of players (in the squad) who play outwith Scotland, but I think it's very clear that your chances of playing for Scotland are greatly heightened by playing for Edinburgh and Glasgow.
"That might be the right thing to do, don't get me wrong.
"I just think that, if you're picking your best players for this Six Nations, and forget the World Cup, because if they're good enough for the Six Nations then you're good enough for the World Cup, you pick your best players and I would've thought Kelly Brown and John Barclay in particular are two that would come in there."
Despite reservations about the omission of some experienced players, Nicol is positive about Scotland's chances in the Six Nations.
"I'm quite excited about what could happen," he said. "It was a good Autumn series.
"A very good performance against Argentina, good again against the best team in the world, New Zealand, and then finished it off well against Tonga.
"So there's a lot of confidence in the squad.
"Edinburgh have improved markedly since the Autumn tests and that's reflected in more players coming in from Edinburgh.
"That's a good sign. These players will be a bit more confident coming into the Six Nations."

Halai has scored 14 tries in 41 games for Wasps since arriving from Auckland Blues in January 2015.
The 29-year-old has started only seven times this season for the Premiership leaders, scoring two tries.
"Frank still has a big part to play for the club as we enter the business end of the season," director of rugby Dai Young told the club website.
"His game-time has been limited this season due to the form of Christian Wade and the development of Josh Bassett, as well as Willie Le Roux coming on board, so it's a really competitive area."

David McConaghie was accused of recording a woman in the toilets at MP David Simpson's constituency office.
A court viewed footage showing what appeared to be McConaghie placing the device in a bowl of potpourri.
McConaghie, from Cottage Hill, Dollingstown, denied making recordings for his sexual gratification.
The court heard he had made them over a period of several weeks in August and September 2012.
When the camera was discovered, Mr Simpson immediately reported it to police, and McConaghie resigned his position.
McConaghie will be sentenced in five weeks' time.
In a statement, Mr Simpson said he welcomed the decision by the judge.
"This has been an extremely difficult time for my staff, but particularly for the victims," he added.
Mr Simpson paid tribute to the bravery of his staff in giving evidence and withstanding "a harsh, invasive cross-examination".
Kelly Brown and John Barclay are among Scotland's best players and should be in the squad for the Six Nations, according to former captain Andy Nicol.
[NEXT_CONCEPT]
Wasps winger Frank Halai will join French Top 14 side Pau at the end of the Premiership season.
[NEXT_CONCEPT]
A former church minister and DUP adviser accused of secretly filming a colleague for sexual gratification has been found guilty of the offence.