Thanks for the reply! You make some interesting points...
Can another London (or for that matter, PAR, FRA, AMS.......) airport survive with only connecting traffic, or with minimal O&D traffic? I fear the answer is no, because in order to achieve profitable loads, the airline(s) would need to route many flights from many destinations through it to attain the critical mass which could only be attained by serving a lot of destinations. The more limited the choice, the less likely it will be to attract premium connecting traffic. If it only served, for example, a subset of BA's destinations, it would probably fail.
It would certainly have to be a robust operation for any chance of success, no doubt at all about that. However, if the second hub doesn't have all of the LHR routes, does it matter from a connections point of view? You just connect through LHR if STN doesn't offer it. It's not designed to rid LHR completely of connecting traffic, just offering flexibility where economically possible.
DXB and other ME hubs have been successful because their creation did not divert traffic from existing airports. This is the problem with another London airport, that it will always weaken the revenue flows from the other airports. The single hub concept works, multiples won't.
It may weaken the revenue flow by taking some traffic away, but surely that can be recouped by the new hub? Furthermore, if a credible hub can be built and becomes more popular with travellers, expansion is far more attainable than at LHR. Surely it doesn't matter where the money is, as long as it's still there in one way or another? The other plus is that in return they may reach out to new markets with the slots that they have 'gained'. I suppose it depends on how much the airlines will value the extra LHR slots.