You only have to look at the 717 route structure to see that it has been replacing the 146 in TAS & SE QLD.
The 146 fleet was about 24 units, the 717 14 units. So, mix with 737, schedule changes and ... "volia"... the 146 is replaced.
IMHO I think that always was the plan right from the start, and a LCC is a completely separate deal.