Just my opinion...
the management at MAN cocked up by not embracing the low cost era at the start
I think you're being a little harsh on the MAN management. When Easyjet started up, LHR and LGW simply didn't want to know - they didn't want some upstart cannibalising existing business and harming long-term customers. LTN didn't have much scheduled business and were happy to take Easyjet.
MAN and BHX in the 1990s both had significant operations from BA, paying high airport fees. Offer an LCC low fees, and BA will demand the same. If a company has a monopoly (as MAN and BHX pretty much did on scheduled flights in the early 1990s in their regions), then you will make bigger profits by charging customers higher prices. When BA had their own terminal at MAN, it would have been absurd for MAN management to cut fees and support an upstart at the expense of their best customer. The management of MAN and BHX were only doing what was economically rational - they wanted to maximise profit for their shareholders.
In the 1990s, LPL and EMA did not have a significant scheduled operation, and could provide cheap fees to LCCs. The real factor that pushed MAN and BHX to talk to LCCs properly was BA significantly cutting, and eventually selling, their regional operations to FlyBE because other airports in the regions now had cheap scheduled flights to Europe.
Yes, the economics is warped, but MAN at the time had a local monopoly and a long established and very good customer in BA. If there had not been regional competition from LPL, the LCC operation in the north would look something like Toulouse does today - a locally dominant airline charging fairly high fares, other network airlines flying from their hubs, and a few LCCs flying in and out, but no LCC planes based locally.
Now that the market disruption event has occurred, it is up to MAN and BHX management to persuade LCCs to shift the emphasis of their operations away from LPL and EMA towards the population centres of MAN and BHX