It's unlikely that the established airlines will ever set up cadetship schemes that would supply more than a tiny proportion of their pilot requirements. For airlines like Virgin Atlantic, which are entirely or predominantly longhaul, it is essential that their pilots come with a great deal of handling experience of reasonable-sized aircraft - because they sure as hell aren't going to get any after they join! Ryanair, Easyjet and most of the charter airlines have traditionally been used as a stepping stone to BA and the like, and that's not likely to change for the reasons above.
As for experienced pilots funding their own retraining, that's always happened in times when jobs were hard to come by. If you have a few thousand hours on, say, 737s and you're after a 757 job, the rating may get you there - it's certainly has a lot more clout when wielded by an experienced airline pilot (even without significant hours on type) than it does when held by a newbie. Bear in mind also that pilots taking this course of action are likely to be looking for contract jobs overseas rather than long-term employment with a stable European carrier.
2WOMW, you're right; the increasing costs of getting a first jet job will eventually cause the supply of self-funding pilots who'll pay to work to dry up! Even Ryanair will realise this, and, as competition for new pilots hots up with airlines' recovery and expansion, they will have to improve the package to attract their share of the available pool. The trouble is, they are so anti-pilot that they will drag their heels on this, and this is just one of the things that union participation will help to sort out.
The fact that TRs are coming down in cost is, I reckon, a symptom of the increasing numbers of TRTOs in the marketplace, and not really (yet) a function of reducing numbers of self-sponsored students. That will happen, though, and the first signs of that will be the removal of some of the weaker TRTOs from the scene.
This is a big subject, and it's not going to get sorted by one thread on Pprune, but it will help if more of you begin to understand the problems that paying to work causes - and the effect it will definitely have on the rewards you presumably look forward to in later life. Look at the music or acting professions for examples of this; the end result is a very few high-earners and vast numbers living on benefits hoping for an occasional period of employment. However, most musicians and actors don't spend 100k getting their skills!
Scroggs