All or nothing
Mark, the suggestion that Flybe may relocate from SOU. is not without merit, but for many reasons, not least the points you raise, it will not be an all or nothing decision. For instance the Channel Islands routes rely on the link with the train and Fast access to London. SOU has a unique selling proposition here.
However the domestic trunk routes from SOU particularly Glasgow, Aberdeen and Edinburgh mostly serve the local market, not those passengers looking for an alternate route to London.
I still think that there is a reasonable prospect that
Flybe will relocate or replicate some of their services that would benefit benefit from being further away from their real competition at LHR and LGW, most likely the domestic trunk routes, as well as Dublin, Amsterdam and Nice. The other Flybe routes attract too much attention from EZY and RYR, clearly there is enough demand at SOU and BOH for the sun routes to operate from both.
Competition for the French Regional Airports is less obvious, it's easy to see these continuing to work well at SOU.
Overall, this is exactly how Exeter operates in relatively close proximity to Bristol.
Time will tell!
FF