I think any change that promotes quality over the low value model is great and to be supported.
The trend has been toward offering the worst quality product possible, so wouldn't a smart business offer a point of difference -- like a class of flight somewhere between full economy and business that makes it possible for passengers to travel in reasonable comfort that doesn't cost as much as business that is just over the top ?
Well done Virgin -- if at some stage I can tear myself away from my Qantas club/QF frequent flyer comfort zone I wll give your premium economy a go, and who knows if I like it I might even use it more than once