Lester,
I think your argument is very sensible regarding REX's abilities as a regional competitor.
However, if you read REX's half and full year results carefully, they actually had $90+ Million sittting in the bank (retained earnings) after the last half, as well as a $20 Million currrent account to pay all their routine outgoings.
Due to REX's financial strength they could easily afford to operate any aircraft type that suits their regional aspirations. Saabs make sense to them as Saabs have made their profits, from which they have regularly paid fully franked dividends to shareholders and in the future I expect their aircraft types may change as they adapt to any significant and long term changes they perceive taking place in those markets.
As always the key to competitively succeeding in business (particularly aviation) is both the quality of your products and service as well as your financial ability to compete with a new operator attempting to contest your existing markets.
The Oracle