I agree that Rotorua is over-rated as a tourist destination, but the fact remains that Air NZ and Qantas see fit to operate 737s there, yet give Hamilton a wide birth. Sure, a lot of it is the Asian market, but in some respects there's more demand for seats into ROT than HLZ. This could mean it does better as an international port than HLZ, but that may still not be enough to make it profitable.
If they can make it work, good on them - I'm sure they will do the market research before parting with that sort of dosh. People seem extremely quick to jump to negative conclusions.