The Qantas seat map planner shows that Qantaslink operates Q400s with 72 seats. If AirNZ uses 78 seats in a Q400 that will be not very comfortable compared with the Qantas planes. If AirNZ uses 72 seats, would they replace ATRs to get 6 extra seats? If jets are used on Rotorua-Christchurch-Queenstown, one reason might be that Inbound Tourism Operators think that their clients prefer to fly in jets. If tourists were rational and understood airline economics there would be no jets between Los Angeles and Las Vegas which is a very short distance. How many Q400s are there on that route?
ATRs are now used on routes that were not part of Mt Cook's network. They are used on CHC-DUD, CHC-WLG and flights from CHC to several North Island destinations. 737-200s were used between CHC and DUD/WLG - the 737-300 and 737-NGs are not good aircraft for the short stage lengths.
E-190s could give better frequencies on some trunk routes. Dunedin could get a third daily flight to Auckland. Perhaps a fourth daily flight from Dunedin to Wellington. The Q400 might be a possibility for some DUD-WLG flights, but an extra 30 minutes between DUD and AKL or Queenstown and AKL is a difference that people notice.
If you are talking about a Q400 with 78 seats, then you compare it with a 737-300 with 149 seats. People are used to seats like that in Europe. Not here.