With all due respect BE have 'been there, done that' with the IOM-LCY route before. They were the first operator and the I doubt that the volume is there to necessitate a Q400 capacity service.
There is little point in re-training crews specifically for LCY or re-equipping their Q400 fleet (as I understand it, LCY requires steep approach modified aircraft) unless there is a significant gain.
BE still have an RE ATR on lease so I very much doubt the two airlines will fall out over this.