I don't see why it's the wrong strategy. Business passengers (individually or institutionally) travel more frequently, they travel all year round and they generally pay more for there ticket. What part of that makes it wrong?
The exposure to business travel trade is growing and there have been contracts signed with businesses in the UK and on the Continent. Remember also that the business passenger isn't always the suited and booted self employed business man or exec but also skilled blue collar workers, convention staff etc etc.
As EI-BUD says, the strategy of setting up shop at slot constrained airports has done wonders for EZY. Higher fares can be charged and yields have increased pretty much every year. Meanwhile being at a slot constrained airport makes it harder for FR and other LCC's to start throwing in loads of aircraft over night. It makes sense. It also makes sense to tap into the large business market that use these airports. If flexi-tickets aren't selling (i'm not sure whether they are or not) this doesn't automatically mean few business travellers. Not every passenger on business needs a flexible ticket.
One thing I will disagree with EI-BUD on, and many others make the same assumption, and that is that free seating puts off business pax. From my experience and anecdotal evidence.....it doesn't. It actually appeals to many of these passengers. It's the leisure/VFR/infrequent flyers who generally hate free seating.
As for LH Italia, they found it hard to compete against Easyjet in MXP by all accounts although this Winter has admittedly so far been extremely kind to the industry.