Moa999...
Around twenty years ago I asked a table of travel agents what the breakdown was in their clientele. They all said around a third wanted to fly Qantas regardless, a third wanted cheapest and the remaining third was split over every other factor.
As you mentioned, our default market share is pretty small. When did you last hear someone call them self a "Ford man" or "Holden man"? That ethos died out with the last generation. I expect that our default proportion would be less than 5% of travel agent traffic.
No brand can enjoy lifelong loyalty without providing palpable value...schemes notwithstanding.
One aspect of selling off the FF division is decoupling international from another money losing accounting entry: FF points are mostly earned on domestic services, and mostly redeemed on international. At well below market rates. I heard that FF buys a seat from International for less than $100, far below the market value, or even the cost of flying that seat.