The old business adage "Turnover is vanity, profit is sanity but cash is king" seems to apply here. MAG are chasing turnover, hoping that profits will accrue from higher revenue, once the high fixed costs of an airport operation are covered.
What they are doing is engaging in that most dangerous manoeuvre, marginal cost pricing. And they appear to have forgotten the basic rules of supply and demand.
Although Stansted is the least attractive of the London area airports due to its location, it is still a London airport, and slots at any London airport will become scarcer - and thus more valuable - as the economy picks up. They have offered Ryanair a deal that gives them lower costs with increasing throughput (ie the scarcer the resource, the cheaper it gets!).
They are so desperate for short-term income to service their massive borrowings that they are engaging in desperate measures. The FR deal, and the EZY one a few weeks ago, demonstrate the fear in the MAG boardroom that as a result of overpaying for STN they will soon have to face up to the taxpayers of the Manchester area who own their business, and are set to get less out of it than when they were just running their local, successful, airport at Ringway.