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"..........they need an aircraft which can produce capacity more cheaply than a 737-300.........."
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I can't believe that anything can fly at a lower seat-mile cost than a Jet2 737-300. The 757 is a big and heavy aircraft for the number of seats. What the 757 is good at is effortless range off a difficult runway.
Having said that, it makes sense to use the 757 out of Manchester too if there's enough demand to fill it. And of course if the eventual mission is Leeds and Manchester to East Coast USA and Canada, the whole project falls into place.
Although the Manchester loads may be lower than expected, the breakeven load factor must be tiny - which means that when they can fill it, the profit is huge.
Just to clarify, the 757 engines with the extended cowlings are E4 and can be found on both ETOPS and non-ETOPS 757's.